Another brilliant builder that’s on my radar is MJ Gleeson (LSE: GLE), and particularly so with new trading details just around the corner on July 4.

The resignation of Jolyon Harrison as chief executive this month, prompted by a row over the size of his paypacket, has really shaken investors. The company’s share price has fallen by almost a fifth in June, a re-rating which suggests a gross overreaction by market makers.

For one, the small-cap is replacing Harrison with a safe pair of hands in former head of Keepmoat Homes, James Thomson, someone who will keep things afloat in the immediate term at least.

Secondly, Gleeson is not as dependent upon their ex-leader as it was during the company’s upscaling programme of a few years back. And thirdly, because of the UK’s gigantic shortage of new homes, the long-term profits outlook for the business remains a compelling one.

Sales are booming

I’m fully expecting Gleeson to remind the market of this when it comes to releasing those fresh financials, something which could well prompt a heavy share price rebound. It certainly impressed last time out in February when it advised revenues boomed 53% in the six months to December, to £118.3m. That upswing was driven by a double-digit rise in unit sales and an increase in average selling prices.

I tipped Gleeson’s share price to jump in the run-up to those half-year numbers and I’m expecting nothing less this time around either. Indeed, the steady stream of positive updates from across the homebuilding sector reinforces my expectations that there’s been no change in those favourable trading conditions.

I’d buy today and never sell

With or without its veteran chief executive, City analysts certainly don’t see Gleeson’s long record of chunky annual earnings growth being blown off course any time soon.

They’re anticipating an 11% bottom-line improvement for the year about to start (to June 2020), following on from another double-digit-percentage rise in the period that’s about to expire. And this means dividends are expected to keep rising too, resulting in a jumbo 5% yield for the forthcoming period.

Gleeson clearly isn’t a share for the here and now. Its efforts to turbocharge build rates puts it in the box seat to ride the homes shortage that’s driving newbuild sales. In my opinion, it’s a great share to buy today and hold for many years to come.

The post Have £5k to spend? A ‘forever’ dividend stock that I’d buy before July appeared first on The Twelfth Magpie.

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• How much would I need in a Stocks and Shares ISA to target £19,036 a year in second income?
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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Small price, big dividends

House-building is one of the hottest sectors to grab a slice of right now. Newsflow from across the segment remains, broadly speaking, pretty exceptional, with supportive lending conditions driving strong buyer demand. And I’m expecting yet another solid update from MJ Gleeson (LSE: GLE) when it unfurls half-year results on Thursday, 14 February.

The firm sprung to three-month highs in early January when it declared “we continue to see strong demand for our low-cost homes,” and another fizzy update in the coming sessions could see it add more gains.

Gleeson’s dirt-cheap valuation currently leaves plenty of scope for another share price spurt. It trades on a forward P/E ratio of 12.3 times, comfortably below the regarded value benchmark of 15 times, and below. It also sports a corresponding, inflation-bursting 4% dividend yield.

The home-builders are very much back in fashion, illustrated by the fact that they now comprise three of the FTSE 100’s biggest risers over the past four weeks (with Taylor Wimpey leading the index, up 20%). Now seems a great time to pile in.

6% dividend yields

Hays (LSE: HAS) is another great stock I feel could surge on the release of interim numbers later this month (Thursday, 21 February).

Investors failed to significantly react to its second-quarter update in the middle of January, but I feel they missed a trick here. Last month, the recruitment ace advised that net fees exploded by double-digit percentages for many of its foreign territories during October-December, and this helped fees on a group level rise by a chunky 9%.

Concerns over Brexit are still doing the rounds and are likely to continue for some time yet. Extra signs of trading resilience from Hays, despite troubles in its home territory, could well fuel a fresh share price advance, though.

Its prospective P/E multiple of 12.4 times, and its smashing 6.3% dividend yield, certainly make it an attractive destination right now.

A FTSE 100 favourite

Smurfit Kappa Group (LSE: SKG) is a company I believe is long overdue a share price bounce. I reckon this could finally occur when full-year results are released on Wednesday, 13 February.

I’ve been arguing that market sentiment towards the packaging sector, spurred by concerns over new capacity hitting the market, has been far too bearish. I believe that signs of more progress from the Footsie firm on the trading front should help allay these concerns and help it to recover some more ground. Last time out in October, Smurfit Kappa declared it “experienced continued demand growth across most markets” during January-September and tipped further gains as growing environmental concerns drive sales of its corrugated products.

A prospective earnings multiple of 8.8 times leaves oodles of room for a fresh re-rating, in my opinion, as does a bulging 3.9% dividend yield. I think next week’s release could prove the catalyst for a share price fightback in 2019.

The post 3 top dividend stocks I’d buy for February (and for 2019) appeared first on The Twelfth Magpie.

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Royston Wild owns shares of Taylor Wimpey. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

But I think investors should make the most of the share price falls that happened around the time of November’s release and treat this as a buying opportunity. A growing global population is creating more mouths to feed, and particularly in emerging regions where Devro is spending big to expand its footprint, and of course which are territories where wealth levels are rocketing.

Sure, Russia may be problematic now, but the huge potential of Devro’s developing territories was underlined in November’s release in which it said in the four months from July 1 it had seen “strong volume performances” in particular in Latin America and South East Asia, as well as  North America.

Those problems in Russia haven’t dented City predictions of soaring earnings growth for the small-cap in the near-term and beyond. The number crunchers expect earnings growth of 19% for 2018, and for this to be followed with additional rises of 12% this year and 10% in 2020.

Meaty profits AND dividend growth

Devro’s share price dive to multi-year lows leaves it on a rock-bottom forward P/E ratio of 9.7 times, much too cheap in my opinion given the bright long-term demand outlook for its collagen products and the rate at which it is increasing capacity.

This is not the only reason to dive in, in my opinion. As I said, Devro is a share that is particularly suitable for those seeking exceptional income flows from their investment portfolios.

And expectations of solid profits growth mean that shareholder payouts are anticipated to keep marching northwards through to 2020, resulting in dividend estimates of 9.6p per share for this year — up from an expected 8.9p for 2018 — and 10.2p for next year. Such projections yield a monster 5.9% and 6.3% respectively.

Safe as houses

Another exceptional, and little known, dividend stock that can be bought today for under £10 is MJ Gleeson (LSE: GLE). It offers great value for money too, the housebuilder boasting an undemanding forward P/E ratio of just 12.4 times.

I’ve spoken long and hard about how construction stocks are unjustifiably cheap and unloved right now, and latest trading details from Gleeson deepened my resolve. It said last week that “strong demand for our low-cost homes” has continued, “supporting both increased build activity on existing sites and the opening of new sites across our target geographic area.”

It’s a performance that’s hardly a surprise given the massive homes shortage in Britain. A market imbalance that City analysts predict will deliver earnings growth of 6% in the year to June 2019 and 11% in the following fiscal period, and one that will keep dividends on a northwards path as well.

A projected 33.6p per share reward for this year yields 4.6%, and the dial moves to 4.8% for fiscal 2020 thanks to the predicted 35.3p dividend. During the past five years, shares in Gleeson have returned some 17% per year, meaning an initial £5,000 investment would leave investors sitting on a handsome £11,000 today. I believe that market conditions should remain favourable enough for it to keep on creating brilliant returns and this, added to the mighty impact that compounding brings, could make some investors millionaires if they hold on to the shares in the decades ahead.

The post An unknown dividend stock, priced under £10, that I think could make you a million appeared first on The Twelfth Magpie.

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• Is there any value left in Lloyds shares now they’re over £1?
• How much would I need in a Stocks and Shares ISA to target £19,036 a year in second income?
• After huge new nuclear deals, are Rolls-Royce’s sub-£15 shares set to power higher?

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK owns shares of and has recommended Devro. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Global giant

Let’s start off with SThree. As I mentioned last time out, the recruitment play is predicted to keep the full-year dividend on hold at 14p per share for the 12 months to November.

Two things to remember, however. This projection still yields an inflation-busting 3.7%. Secondly, a combination of robust earnings growth forecasts (the City is expecting profits jumps of 9% and 15% in fiscal 2018 and 2019, respectively), and solid balance sheet strength, suggests that dividends should march higher again from next year.

For the approaching period, a 14.9p per share dividend is anticipated by brokers, meaning that the yield marches to 4%.

Regular readers will know my bullish take on the business on account of its impressive progress in overseas markets, as well as a more specific focus on the areas of science, technology, engineering and mathematics. Latest trading details reinforced my positivity as well.  SThree declared last week that group gross profit leapt 13% from June to August, to £82.7m. That was assisted by a 24% improvement in profits in Continental Europe, 16% in the Asia Pacific/Middle East combined territory, and 8% in the US.

The company remarked that “trading conditions in the majority of our markets are encouraging”. And as it bulks up its global headcount (it was up 7% year-on-year as of the close of August), I’m backing SThree to continue impressing long into the future. Considering it trades on a forward P/E ratio of just 13.4 times, I also believe it’s too good to miss right now.

Housing star

As I’ve mentioned more recently, and looking further afield, housebuilders remain at the mercy of housing ministers and the future of the critical Help To Buy purchase scheme. I’m convinced that fears of a serious alteration, or even termination, are overblown, however. Indeed, I think that MJ Gleeson’s (LSE: GLE) forward P/E ratio of just 13.4 times more than bakes in these risks.

The City sees no reason for earnings growth at the FTSE 250 firm to hit the skids any time soon, and they’re forecasting a 5% earnings rise in the year to June 2019. And this leads to predictions of a 29p per share dividend, too, a figure that yields a chunky 3.7%.

MJ Gleeson’s share price exploded this week as it painted a bright trading picture looking ahead, commenting that “demand for low-cost homes in the North is strong” and added that “our homes continue to remain highly affordable despite the recent increase in bank rates and mortgage finance remains readily available.”

In this environment, I see plenty of scope for current profits and dividend projections for the builder to be upgraded. And this, allied with the multitude of problems that will keep Britain’s housing shortage stretching long into the future, makes MJ Gleeson a great stock to buy now… and to hold for years to come.

The post 2 cheap FTSE 250 dividend stocks I’d buy today and hold for the next 20 years appeared first on The Twelfth Magpie.

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• How much would I need in a Stocks and Shares ISA to target £19,036 a year in second income?
• After huge new nuclear deals, are Rolls-Royce’s sub-£15 shares set to power higher?

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

The firm used to be a building, contracting and civil engineering beast but sold its contracting and civil engineering businesses between 2004 and 2010 to concentrate on development. I reckon a narrower approach to trading in one specialist area is almost always a good thing when it comes to business. That way it’s easier for a firm to develop expertise and efficiency at what it does, which often leads to greater profits.

A buoyant market

These days, the company’s business earns money in two ways. Firstly, it builds homes for first-time buyers on brownfield sites within its Homes Division in the North of England. Secondly, the Strategic Land division buys options over land in the South of England in order to enhance the value of the sites by securing residential planning consents. It then sells to other builders and developers for a profit. Both divisions are making decent money.

I’m keen on the idea that Gleeson develops brownfield land rather than ripping up greenfield areas. I reckon more building firms should do that. Gleeson makes the strategy pay because brownfield land is cheaper. The company then builds affordable starter homes rather than chasing bigger profit margins by building larger houses.

Chief executive Jolyon Harrison pointed out in today’s report that the firm operates in “the fastest growing and most resilient part of the housing market.” Typically, people buying the firm’s houses are young, first-time buyers on low incomes moving from renting or from living with family. The wide availability of mortgages and government incentives supports the market, and it often works out cheaper for people to buy than to rent in today’s low-interest-rate environment.

The housing market is notoriously cyclical, but Mr Harrison explained that Gleeson’s strategy removes secondary market risk. People who already own a home can put off moving to another one if economic times are tough. However, Gleeson’s customers who buy for the first time will likely buy their first home when they arrive at the right age with less consideration of the wider economic picture. The firm estimates that around four million people rent homes in its target geography, which suggests that the potential for growth is large. Gleeson is the only listed house-builder dedicated to the starter home market and it sees high demand when it opens new sites.

Good figures and an agenda for growth

Revenue and earnings have been rising for several years and today’s figures sparkle too. Revenue came in 23% higher than last year, cash from operations moved 10% higher and earnings per share lifted 15%. The directors pushed up the total dividend for the year by a whopping 33%, “reflecting the Group’s strong financial performance and our confidence in the prospects for the current year and beyond.”  Indeed, the company said it is on course to double sales to 2,000 units per year over the period 2017 to 2022.

With the share price near 718p, the forward dividend yield sits just over 4% for the trading year to June 2019, and the payment looks set to be covered almost twice by earnings. I think the stock is attractive.

The post Why I’d buy shares in this growing 4%-plus dividend yielder appeared first on The Twelfth Magpie.

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• How much would I need in a Stocks and Shares ISA to target £19,036 a year in second income?
• After huge new nuclear deals, are Rolls-Royce’s sub-£15 shares set to power higher?

Kevin Godbold has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Britain’s small-cap index is jam-packed with exceptional income shares so I’ve picked out even more for you to consider, placed in no particular order. Count them down; you won’t be disappointed.

6. International Personal Finance

International Personal Finance’s(LSE: IPF) share price has spiked in recent sessions amid news of better-than-expected collections in its European marketplaces in the first six months of 2018, a situation that prompted the doorstep lender to advise that full-year profits would beat all forecasts.

While impressive, it is the huge revenues possibilities over at its Mexican home credit and IPF Digital arms that I am really excited about — the amount of issued credit in these areas rose 13% and 44% respectively during January-June, and demand here looks set to continue booming.

Now City analysts are expecting the dividend to remain on hold at 12.4p per share yet again in 2018. The good news is that this figure still yields 5.2%, however.

To put an even bigger smile on your face, International Personal Finance is expected to bounce back into earnings growth in 2019, meaning that the Square Mile is confident that the firm should lift the dividend to 12.6p. This means that the yield stomps to a staggering 5.3%.

5. 4Imprint Group

The yields at 4Imprint Group (LSE: FOUR) may not be as mesmerising as those of International Personal Finance. But the rate at which dividends are growing (up 111% over the past five years alone) should make income-seekers sit up and take notice.

It’s not likely that dividend expansion is set to slow any time soon either, given the rate at which its cups, bags and other promotional products are being snapped up. Revenues grew 16% and order intake jumped 15% year-on-year during the first four months of 2018, and a strong US economy should help sales to keep spiralling skywards.

Earnings at the firm are expected to continue swelling by double-digit percentages through to the close of 2019, keeping City brokers expectant of further dividend leaps too. Last year’s 58.1 U cents per share reward is expected to skate to 63.5 cents this year and 72 cents next year, resulting in handy-if-unspectacular yields of 2.5% and 2.8% respectively.

4. Bloomsbury Publishing

The publisher of the Harry Potter series of books, Bloomsbury Publishing (LSE: BMY), can always rely on the evergreen popularity of the boy wizard to keep driving dividends higher.

It may be two decades since the Hogwarts hero first hit bookshelves, but his popularity with young and adult readers alike remains undiminished. The franchise ranked amongst Bloomsbury’s hottest sellers in the four months to June, and the publisher continues to capitalise on its broad acclaim by bringing out new editions on a regular basis.

Harry Potter isn’t the only reason to expect profits and dividends to keep growing, however. The small-cap is also in a good place thanks to the vast amounts it is investing in building its position in the academic and professional digital resources sphere.

With earnings expected to keep rising City brokers are predicting dividend growth to hit as much as 8p per share in the 12 months to February 2019, from 7.51p last year, and again to 8.4p next year. This means that yields stand at an inflation-topping 3.6% and 3.8% for these respective years.

3. Devro

Sausage-casings manufacturer Devro (LSE: DVO) has been forced to keep the dividend locked at 8.8p per share for what appears to be an age. A lengthy period of earnings fluctuations has seen it lack the confidence (and the balance sheet strength) to hike payouts, but things could be about to change.

City analysts expect the firm to deliver robust profits growth through to the end of next year, meaning that Devro is expected to raise the dividend to 9p this year and again to 9.3p in 2019. Subsequent yields clock in at 4.5% and 4.7%.

There’s a lot of reason for the number crunchers to be optimistic. Devro is a rare firm in that it’s seeing its costs dropping through the floor (down £7m in 2017, beating forecasts), at the same time as its sales are marching on, particularly in hot growth territories like Russia and China. There’s a lot to like about Devro and its self-help strategy right now.

2. MJ Gleeson

News that MJ Gleeson (LSE: GLE) remains on course to supercharge home sales over the next five years has got me very excited.

The urban regeneration specialist sold 1,225 properties in the 12 months to June, up by a fifth (or 20.9% to be exact) from a year earlier. It’s well on track to hit its target of 2,000 homes per year within the next five years, it said, and I wouldn’t bet on it missing expectations as it ramps up production (it aims to be active on 70 sites in the course of fiscal 2019 versus 65 today).

Dividends at the firm have jumped 860% over the past five years as earnings have shot through the roof, culminating in last year’s 24p per share reward. Payout expansion is expected to slow in the medium term, however, to 27.1p in the year just passed and 29p in the current year. But the builder and its meaty forward yield of 3.8% are not to be scoffed at, particularly as cash flows burst through the roof and profits look set to keep growing.

1. Headlam Group

Those hunting for blowout yields now and in the future could do a lot worse than splashing the cash on Headlam Group (LSE: HEAD).

A 26p per share dividend is anticipated for 2018, up from 24.8p last year and yielding 5.6%. The yield for next year moves even higher to 5.9%, thanks to the firm’s estimated 27.4p payment.

The floorcoverings giant has been hit more recently by tough conditions in its UK marketplace in 2018 so far, but its divisions in continental Europe continue to perform well. Like-for-like sales in Europe edged up by 1.8% in the six months to June. And it is a combination of robust economic conditions on the continent, plus the completion of Headlam’s shrewd acquisitions at home and abroad, that make me confident that this is one business that could provide you with a packet to retire on.

The post 6 small-cap dividend stocks that could be millionaire-makers appeared first on The Twelfth Magpie.

More reading

• Why Barclays shares could have a huge second half of 2026
• Back below 500p, is it time to consider BP shares again?
• Is there any value left in Lloyds shares now they’re over £1?
• How much would I need in a Stocks and Shares ISA to target £19,036 a year in second income?
• After huge new nuclear deals, are Rolls-Royce’s sub-£15 shares set to power higher?

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK owns shares of and has recommended Devro. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

The tech giant boasts a long record of undisturbed profits growth over the past five fiscal periods alone, and the bottom line has swelled at an impressive compound annual growth rate of 11.4% over that timespan too.

City analysts do not expect IQE to run out of steam just yet either. They are predicting additional earnings rises of 11% in 2018 and 38% in 2019, with growth expected to really pick up next year as the use of the company’s VCSEL technology in mass-market applications really takes off.

Investor appetite may not have kicked in for the AIM-quoted business since I last covered it in February, but I remain convinced the company should deliver stunning profits growth in the near term and much longer. Before I continue, however, I would like to look at another stock destined to deliver brilliant earnings improvements: MJ Gleeson (LSE: GLE).

Building brilliant profits

While the newsflow surrounding the UK homes market has remained pretty stable over the past several months, those making up the housebuilding sector have failed to replicate some of the stunning share price rises of 2017.

This is something of a mystery to me. Indeed,a couple of months ago Gleeson reported that “demand for our homes amongst our customer base remains strong,” the business adding that unit sales jumped by almost a third year-on-year during July-December to 593.

And the business is building its land bank to undergird future revenues growth, this rising to more than 12,000 plots as of the end of 2017 from 11,588 plots a year earlier. It also opened a new pilot office in Ashington, Northumberland to meet soaring client demand.

Like IQE, Gleeson has a splendid record of throwing out double-digit percentage improvements in annual earnings, this having improved by a compound annual growth rate of 35.5% over the past five years.

And the number crunchers believe that, with the country’s housing crisis driving demand for new-build properties, Gleeson should keep on generating excellent profits expansion. Indeed, rises of 10% are forecast for both the years to June 2018 and 2019.

Given its proven growth credentials I reckon the business is trading  too cheaply right now, Gleeson boasting a dirt-cheap forward P/E ratio of 13.5 times.

Semiconductor star

Now although IQE may deal on an elevated forward P/E ratio of 28.2 times, I do not believe it is any less of an attractive bet than the housebuilder.

The company saw revenues boom 16.4% during 217, to £154.5m, with wafer sales jumping 21% thanks to volume ramp-ups linked to the rollout of Apple’s iPhone X. Meanwhile, sales across IQE’s Photonics division more than doubled to £47.6m last year.

What’s more, IQE has plenty of financial headroom to raise capacity to meet the expected soaring in demand in the years ahead, as well as to plough plenty of capital into product R&D. It comes as no surprise that Square Mile analysts are expecting earnings at the semiconductor maker to keep ripping higher.

The post IQE isn’t the only super growth stock I’d buy with £2,000 today appeared first on The Twelfth Magpie.

More reading

• Why Barclays shares could have a huge second half of 2026
• Back below 500p, is it time to consider BP shares again?
• Is there any value left in Lloyds shares now they’re over £1?
• How much would I need in a Stocks and Shares ISA to target £19,036 a year in second income?
• After huge new nuclear deals, are Rolls-Royce’s sub-£15 shares set to power higher?

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK owns shares of and has recommended Apple. The Motley Fool UK has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

That’s MJ Gleeson (LSE: GLE), which builds homes on brownfield land in what it terms “challenging communities” in the North of England.  This means marketing homes with an average selling price of £124,000 to low income buyers who are generally ignored by bigger homebuilders.

This is appealing to investors for several reasons. For one, purchasing former industrial land, reclaiming it and rezoning it into housing stock means the company can buy its properties for very low prices compared to rivals.

Furthermore, selling homes at relatively low prices means the company is insulated from external issues such as the increased stamp duty, strengthening pound or Brexit-related worries that are creating headaches for developers in the south of the country.

This is borne out in the company’s financial results for the half year to December, when an increase in housing plots sold and rising prices buoyed revenue by 34.7% to £73.7m for its homes division, while operating profits jumped 44.7% to £12.3m.

Improved margins boosted the group’s period-end net cash balance to £26.7m and allowed management to increase its interim dividend payout by 38.5% to 9p per share. With its shares trading at just 14.6 times earnings, a 3.6% dividend yield and solid growth prospects, I think MJ Gleeson could be an attractive option for investors wanting exposure to the property sector.

All its eggs in one basket

On the other hand, I’m steering well clear of London developed Capital & Counties (LSE: CAPC). The company has two developments, one in progress in Earl’s Court and another already well established in Covent Garden.

And while the Covent Garden estate continues to perform well, with its value increasing by 4.3% year-on-year on a like-for-like basis, the Earl’s Court development’s value plummeted by 11.8% during the year. Management blamed political and economic uncertainty for the falling value of this development and for the time being it looks like these twin problems will continue to haunt developers as Brexit negotiations drag on.

For now this isn’t a huge issue as the Earl’s Court development is still very much a work in progress and Capital & Counties is a long-term developer with low levels of leverage. However, over the long term, the company’s prospects still rely entirely on continued gains for property prices in London.

And while London property has proved resilient in previous downturns, I’m not entirely convinced the capital’s housing market can continue to appreciate astronomically forever, especially as Brexit begins to bite in a few years’ time. With that in mind, there’s little chance I’ll be investing in Capital & Counties any time soon.

The post One property stock I’d buy today and one I’d sell in a heartbeat appeared first on The Twelfth Magpie.

More reading

• Why Barclays shares could have a huge second half of 2026
• Back below 500p, is it time to consider BP shares again?
• Is there any value left in Lloyds shares now they’re over £1?
• How much would I need in a Stocks and Shares ISA to target £19,036 a year in second income?
• After huge new nuclear deals, are Rolls-Royce’s sub-£15 shares set to power higher?

Ian Pierce has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Those proclaiming that the gold-trimmed returns of yesteryear are now consigned to history cite factors like slowing home price growth and rising construction costs as reasons for share pickers to think twice before taking the leap.

I am not so concerned however, and have indeed put my money where my mouth is (I own shares in both Taylor Wimpey and Barratt Developments). The country’s yawning homes shortage is not going to go away any time soon. And in this environment, I can see the country’s listed builders continuing to dole out ripping returns for their shareholders.

Build a fortune

MJ Gleeson (LSE: GLE) is a share I have tipped for greatness several times before. And Monday’s sunny market update — a release that has sent its share price shooting 6% higher — has affirmed my positive assessment.

The Sheffield business, which specialises in providing affordable housing in the North of England, declared that sales at Gleeson Homes exploded 31.5% during the six months to December, to 593, while revenues at the division rose 34.7% higher to £73.7m. As a consequence, group pre-tax profit jumped 19.1% to £13.7m.

This bubbly outlook prompted Gleeson to hike the interim dividend to 9p per share from 6.5p in the same 2016 period.

Chief executive Dermot Gleeson lauded the “very encouraging start to the year” and struck a positive tone looking ahead, commenting: “Land remains available to us at sensible prices and demand for our homes amongst our customer base remains strong.”

Reflecting this supportive environment, City analysts expect the construction star to report earnings expansion of 9% and 10% in the years ending June 2018 and 2019 respectively. And so further meaty dividend growth is anticipated too.

A 25.9p per share payout is predicted for the current period, up from 24p in fiscal 2017 and yielding 3.5%. The excellent news does not end here as an estimated 28.3p dividend for next year nudges the yield to a tasty 3.9%.

I am confident that Gleeson has what it takes to remain a hot growth and income share for many years to come.

Looking good

Yields over at Superdry (LSE: SDRY) may not be impressive but, for those seeking exceptional dividend growth, I reckon it’s hard to look past the fashion star.

Supported by a predicted 14% earnings advance in the year to April 2018, City brokers are expecting the FTSE 250 fashion house to lift the dividend to 32.3p per share from 28p last time around, resulting in a handy-if-unspectacular 1.8% yield.

And in fiscal 2019 the dividend — assisted by an estimated 17% profits improvement — is likely to march to 38.2p, meaning an even-better 2.2% yield.

Superdry is throwing the kitchen sink at expanding its global store network, a programme that helped deliver a 12.8% improvement in Retail revenues during the 26 weeks to October, to £242.7m. The company now has 600 stores up and running across the world and, with the company now targeting the hot growth markets of the US and China, I expect sales to continue booming long into the future.

The post 2 top dividend stocks I’d buy in March appeared first on The Twelfth Magpie.

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Royston Wild owns shares in Taylor Wimpey and Barratt Developments. The Motley Fool UK has recommended Superdry. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

The US economy is going from strength to strength, driving demand for the Footsie star’s rental equipment. At Sunbelt — its Stateside division that sources more than nine-tenths of overall profit — sales boomed 15% during July-September.

And demand for Ashtead’s services is likely to keep increasing as infrastructure spending across the globe clicks higher, whilst the company’s insatiable appetite for bolt-on acquisitions should also keep trade rolling in.

Stateside star

Ashtead has a brilliant record of throwing out double-digit earnings improvements year after year, and with market conditions improving in its most important territory, City analysts do not see this trend ceasing any time soon.

In the current year ending April 2018 the Footsie star is expected to generate a 16% bottom line improvement, and it is anticipated to follow this with an extra 12% rise in fiscal 2019.

Despite its exceptional profits history and strong outlook, however, Ashtead can still be picked up for a song. Whilst a forward P/E ratio of 16.4 times may nudge ahead of the widely-accepted value benchmark of 15 times, a PEG reading of 1 suggests that the rentals giant is in fact a bargain.

Meanwhile, there is plenty for income seekers to set their teeth into, Ashtead is expected to keep its ultra-progressive dividend policy in business. It hiked the dividend 22% last year to 27.5p per share, and more chunky increases — to 31.3p and 34.8p this year and next — are forecast. These projections yield a handy 1.6% and 1.8%.

Build a fortune

Those on the hunt for great growth and dividend shares for a small price should also give MJ Gleeson (LSE: GLE) a close look today.

The massive housing shortage in the UK means that firms across Britain’s housebuilding sector continue to deliver brilliant profits growth, such is the clamour for new-build properties. And MJ Gleeson was the latest such business to underline the positive market backdrop earlier this week.

It advised that the “increasing number of sales outlets, combined with very strong customer demand in all regions, good mortgage availability and attractive levels of affordability means that the outlook for the division remains very positive.”

The division has hiked the number of sales outlets to 58 from 50 at the same time last year, and it has plans for 70 by the middle of next year. A strong forward order book at the end of November, standing more than 30% higher year-on-year, underlines that the business is right to be optimistic.

Indeed, the number crunchers are expecting MJ Gleeson, which also has a knack of grinding out brilliant profits growth year after year, to throw out another 9% earnings rise in the year ending June 2018. And this estimate leaves it changing hands on a mere prospective P/E rating of 14.7 times.

The solid outlook for the housing market should also keep dividends growing at a healthy rate, too, and for this year a 26p per share payout is predicted, up from 24p last year and leaving a 3.5% yield.

The post A FTSE 100 bargain for growth and dividend investors appeared first on The Twelfth Magpie.

More reading

• Why Barclays shares could have a huge second half of 2026
• Back below 500p, is it time to consider BP shares again?
• Is there any value left in Lloyds shares now they’re over £1?
• How much would I need in a Stocks and Shares ISA to target £19,036 a year in second income?
• After huge new nuclear deals, are Rolls-Royce’s sub-£15 shares set to power higher?

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.