Strong performance

Updating the market on Wednesday regarding its quarterly performance was Talktalk (LSE: TALK). The company’s outlook for the full year has remained unchanged, with it performing as expected in the three months to 30 June. For example, it saw good growth in the on-net base, with customer numbers rising by 20,000 versus a fall of 9,000 in the first quarter of the prior year.

This was made up pf growth in both its Consumer and Wholesale divisions. In Consumer, there was further strong demand for the company’s Fixed Low Price Plans, with new acquisition activity and re-contracting driving the total number of customers on the plan to 1.3m. The growing in-contract base is continuing to contribute to improvements in the company’s churn rate, with early life churn from customers signed up to the pricing plans significantly lower than in previous year. This suggests that Talktalk may enjoy higher repeat business and more stable financial performance in future.

In terms of its growth outlook, Talktalk is forecast to record a rise in its bottom line of 23% next year. This puts its shares on a price-to-earnings growth (PEG) ratio of just 0.7, which suggests that they may offer high growth potential at a reasonable price. With a sound strategy and a wide margin of safety, now may be the right time to buy a slice of the business.

Upbeat outlook

Also offering upside potential at present is international corporate services company Hogg Robinson (LSE: HRG). Its track record of growth is somewhat mixed, with its bottom line having been relatively volatile in recent years. This trend is set to continue, with a fall of 10% due this year. However, this is forecast to be followed with a bottom line growth of 15% next year.

The market seems to have factored in Hogg Robinson’s volatile earnings outlook. It trades on a PEG ratio of just 0.5, which suggests a wide margin of safety is on offer. If the company is able to deliver financial performance which is in line with its forecasts, it may see its valuation rise because investors seem to be pricing in a downgrade to at least some extent.

As well as growth potential, Hogg Robinson has a dividend yield of 4% from a payout which is covered 2.5 times by profit. This suggests dividend growth could be high, which may make it an enticing income stock over the long run.

The post 2 cheap growth stocks to help you achieve financial independence sooner appeared first on The Twelfth Magpie.

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Peter Stephens owns shares of Talktalk.

Build a fortune

I believe recent share price weakness at Costain Group (LSE: COST) provides a fresh buying opportunity for value chasers. The company continues to benefit from rising investment in UK infrastructure, with revenues leaping 17% last year to £1.32bn, and its forward order book rising to £3.9bn as of December from £3.5bn a year earlier.

The City expects earnings at Costain to march 6% higher in 2016, resulting in a cheap P/E rating of 12.4 times. And the multiple moves to just 10.8 times for next year thanks to a predicted 14% bottom-line rise.

Meanwhile, predicted dividends of 12.4p and 14.1p per share for 2016 and 2017, respectively, should keep income investors happy — these figures yield 3.8% and 4.3%.

Electronics excellence

In my opinion Acal’s (LSE: ACL) expanding global presence should underpin rocketing sales growth in the years ahead. The electronics play now sources 17% of total sales from outside Europe, up from 12% a year ago. And demand for Acal’s bespoke products continues to heat up, the company inking “a number of new large customer contracts” in recent months.

The number crunchers expect Acal to record earnings growth of 14% and 12% in the years to March 2017 and 2018, respectively, forecasts that produce very attractive P/E ratings of 13.5 times and 12 times.

And Acal’s bubbly earnings growth is expected to keep sending dividends higher too. A predicted payout of 8.6p per share for the current period yields a handsome 3.3%, and this moves to 3.6% for 2018 thanks to an estimated 9.3p reward.

Motoring higher

News of surging car demand certainly bodes well for vehicle dealership Lookers (LSE: LOOK). Car sales rose 5.3% year-on-year in March, according to latest Society of Motor Manufacturers and Traders data. This marked the biggest jump for two decades, and I expect sales to remain strong as an improving British economy boosts big-ticket spending.

Lookers is expected to keep its strong earnings record rolling with a 7% advance in 2016, resulting in a mega-low P/E ratio of 9.1 times. And the multiple moves to 8.6 times for next year thanks to an expected 6% bottom-line rise.

Projected dividends for the period may not provide much to write home about — forecasts of 3.5p per share for 2016 and 3.8p for 2017 yield 2.3% and 2.6% respectively. But I believe the firm’s staggeringly-low earnings multiples more than make up for this shortfall.

Services star

Spearheaded by the rising popularity of its Fraedom business expenses technology, I reckon corporate services provider Hogg Robinson Group (LSE: HRG) can look forward to stonking sales growth. The company has chucked vast sums at marketing and distributing the software, a strategy that drove sales of the product 10% higher between last April and September alone.

Against this backcloth, the City expects Hogg Robinson to enjoy earnings rises of 7% and 9% in the periods to March 2017 and 2018, resulting in irresistible P/E ratios of 8.4 times and 7.5 times.

Meanwhile, an expected dividend of 2.7p per share for the current period yields a smashing 4.3%. And an anticipated 2.9p reward for 2018 drives the yield to 4.7%.

The post 4 Small Cap Bargains You Simply Can’t Afford To Miss! appeared first on The Twelfth Magpie.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

The perfect package

Packaging play Mondi (LSE: MNDI) greeted the market with bubbly financial numbers in Tuesday trade, sending the stock 0.5% higher from last night’s close.

Mondi advised that underlying operating profit for 2015 should clock in above the €767m recorded in the prior period, with underlying earnings per share anticipated to advance between 22% and 27% from 2014 levels, at 131-136 euro cents per share.

And I believe the Surrey business is in great shape to enjoy further stunning earnings growth well into the future, as expansion into hot sub-segments in the packaging industry — not to mention rising presence in the US and Asia — pays off.

The City expects Mondi to report a 10% earnings advance in 2016, resulting in a very-decent P/E multiple of 14.1 times. And a handy 41.5p per share dividend, yielding a chunky 2.8%, seals in the investment case in my opinion.

Services play on the up

Like Mondi, corporate services provider Hogg Robinson (LSE: HRG) also provided plenty of cheer in Tuesday’s session after releasing its own reassuring trading update. Shares were last 2.3% higher as a result.

Hogg Robinson advised that it had “continued to trade in line with our expectations during the second half of the company’s financial year to date,” with full-year growth expected to meet current market expectations. And the growing popularity of cutting-edge products, like its travel and expense management solution Fraedom, should keep earnings heading higher in the longer-term, in my opinion.

The number crunchers expect Hogg Robinson to follow a 6% earnings uptick in the period to March 2016,with a 7% advance in the following year, resulting in ultra-low P/E ratings of 10.4 times and 9.8 times respectively.

And when you throw in prospective dividends of 2.5p per share for 2016 and 2.7p for next year — payouts that yield 3.4% and 3.7% correspondingly — I reckon Hogg Robinson is a terrific selection for those seeking brilliant all-round value.

A premier pills pick

Drugs colossus AstraZeneca (LSE: AZN) has enjoyed a solid bump higher during the past week, with its share price gaining 7% from recent two-year nadirs as bargain hunters have piled in.

And with good reason, in my opinion. AstraZeneca’s advice this month that it expects further revenues falls in 2016 may have weeded out less-hardy investors, but this was always likely to be the case as patent losses on key products like Crestor and Nexium continue.

Instead, I believe the result of chief executive Pascal Soriot’s R&D overhaul in recent years should deliver delicious returns in the years ahead. A focus on ‘growth platforms’ like diabetes, respiratory and oncology is already delivering the goods, with sales in these areas rising 11% in 2015. And I reckon prolonged sales growth can be expected as global healthcare demand takes off.

Although the City expects AstraZeneca to endure a further 10% earnings decline in 2016, I believe a subsequent P/E multiple of 16.5 times is a great level to tap into the firm’s great growth prospects. On top of this, a projected 280-US-cent-per-share dividend yields a splendid 4.2%.

The post Should You Buy AstraZeneca plc, Mondi Plc & Hogg Robinson Group plc Today? appeared first on The Twelfth Magpie.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has recommended AstraZeneca. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

The prescription for plump returns

With drugs giant GlaxoSmithKline (LSE: GSK) throwing the kitchen sink at developing its next generation of revenues drivers, I believe the business is in great shape to deliver stunning returns in the years ahead.

The Brentford company has a splendid track record of getting product from lab bench to pharmacy shelf and, with GlaxoSmithKline planning to submit 20 new products for approval by 2020, I reckon the firm is in great shape to hurdle its current patent-related troubles.

Indeed, after notching up a predicted 20% earnings decline in 2015 — the fourth on the bounce, if realised — the City expects GlaxoSmithKline’s turnaround plan to start really kicking into gear from next year onwards. An 11% bottom-line ascent is currently forecast for 2016, resulting in a decent P/E multiple of 16.3 times.

A reading around or below 15 times is generally considered very attractive value, and given the huge potential of GlaxoSmithKline’s rejuvenated product pipeline — not to mention galloping healthcare investment in established and emerging geographies alike — I believe this represents a great level to get in on the pharma play.

On top of this, GlaxoSmithKline’s stellar earnings outlook has prompted the business to propose an 80p per share dividend through to the close of 2017, resulting in a market-busting yield of 5.9%. By comparison the FTSE 100 average yield stands closer to 3.5%.

Services play set to surge?

Similarly, I reckon corporate services provider Hogg Robinson (LSE: HRG) is a solid choice for those seeking great growth and income prospects at a terrific price.

The Basingstoke firm — which provides travel, expense and data management solutions across the globe — advised on Wednesday that underlying pre-tax profit galloped 15% higher during April-September, to £13m, even though revenues slipped 4% during the period to £155.9m.

Hogg Robinson noted that the top-line slippage was caused by “expected migration from classic to online booking and strong competitor pricing,” although the company noted that its core UK market continues to grow while business is also picking up in Europe. On top of this, demand for the firm’s cutting-edge Fraedom technology continues to take off, and sales at this division leapt 10% in the first half.

With restructuring also clicking through the gears — operating profit margins rose to 12.3% from 10.8% a year earlier — the number crunchers expect Hogg Robinson to enjoy 8% earnings upticks in the periods ending March 2016 and 2017 respectively, figures that leave the services provider dealing on ultra-low P/E ratings of 9.5 times and 8.8 times for these years. Any sub-10 reading is widely considered a steal.

And when you factor in projected dividends of 2.5p and 2.7p per share for 2016 and 2017 respectively — creating hefty yields of 3.7% and 4% — I believe Hogg Robinson is a compelling value pick.

The post Why GlaxoSmithKline PLC & Hogg Robinson PLC Provide Terrific Value For Money! appeared first on The Twelfth Magpie.

More reading

• The £15bn defence splurge that could send UK shares soaring in July
• Up 446% in 12 months! What’s next for the Ceres Power share price?
• How much is needed in an ISA to unlock £1,220 of passive income a year?
• Forget meal deals! Here’s how £8 a day could be worth £357,000
• Up 132% and surging, how is this FTSE 250 share STILL so cheap?

Royston Wild has no position in any shares mentioned. The Motley Fool UK has recommended GlaxoSmithKline. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.