The wealth platform shows companies that consistently grow their dividend, year after year, deliver the best returns, both in terms of income and capital growth.

It came to this conclusion after examining the 26 companies on the FTSE 100 that have increased their dividend every single year for the last decade. Currently, they return just 3.1% on average, well below the 4.8% average across the FTSE 100. But in growth terms, they’re unbeatable.

Ashtead Group

The top FTSE 100 dividend stock over the last 10 years is equipment rental specialist Ashtead Group (LSE: AHT). If you had invested £1,000 in 2009, you’d be getting dividends totalling £531 a year, a return of 53.1% on your original investment. 

This unsung investment hero has also delivered regular share price growth, jumping 130% over five years, and 20% over the last year. Ashtead has been boosted by its massive exposure to the US economy, so no Brexit worries here. 

Ashtead’s North American subsidiary, Sunbelt, generates an astonishing 90% of group earnings and more than £1bn of profits, which has helped to offset weaker UK margins. The big concern is that the US economy will slow, but with the Fed cutting rates, that’s less of a worry.

The £11bn group trades at just 11.1 times forward earnings, which is surprisingly low given its healthy share price outperformance and rapidly rising revenues. It has posted double-digit earnings per share growth for each of the last five years, ranging from 22% to 37% a year. There are signs of a slowdown though, with City analysts forecasting earnings growth of ‘just’ 17% in the year to 30 April 2020, and 11% the year after.

Ashtead’s current yield is just 3.5%, but management remains committed to “a progressive dividend with consideration to both profitability and cash generation that is sustainable through the cycle.” In this respect, it has good form.

St James’s Place

Next best dividend stock of the decade, financial advisory group St James’s Place (LSE: STJ), trails some way behind. If you’d invested £1,000 a decade ago, you’d currently draw £183 a year in dividends, a yield of 18.3% calculated on your original investment. Current forecast yield is 4.7%, although cover is low at 0.7.

The St James’s Place share price is up 10% in the last month, as strong customer net inflows drove funds under management to a record £112.8bn, even if the rate slowed slightly amid “an uncertain external environment.”

St James’s Place draws regular criticism for overcharging its customers but investors have nothing to complain about, as the group has increased its payout at a compound annual rate of 25%.

In July, management froze its interim payout at 18.49p per share, after short-term profits were hit due to extra investment in the group’s partnership network and academy, and its Asian and Rowan Dartington operations. 

Another concern is that it’s expensive, trading at 28.7 times earnings, due to a projected 39% earnings drop this year (they’re expected to jump 42% next).

Despite that, both these dividend heroes look nicely set for another decade of income and growth.

The post These 2 FTSE 100 companies are my best dividend stocks of the past decade. I’d buy them today appeared first on The Twelfth Magpie.

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Harvey Jones 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.

Clients can pay as much as 4.5% in initial advice fees with further fees of 1% or more per annum levied on funds managed by the group. Exit charges also apply, which can discourage investors from leaving to seek cheaper deals elsewhere.

Still, despite these charges, investors across the UK have entrusted the group with more than £100bn of their cash, so St James’s has to be doing something right. And that’s why I think the stock could be a fantastic addition to your income portfolio today.

As St James’s has grown over the past six years, management has prioritised dividend growth. The payout has increased at a compound annual rate of 25%.

Today, the stock supports a dividend yield of 5.4%. Only on a handful of other occasions has the yield reached this level. As a result, I think now would be a great time to snap up shares in this dividend growth champion.

Turnaround complete

Another FTSE 100 dividend stock that I’ve got my eye on today is insurance group RSA (LSE: RSA). The company used to be one of the top income stocks in the FTSE 100 but, in 2014, it was forced to slash distribution as it struggled with rising costs, alongside increasing losses and asset impairments.

RSA lost a staggering £350m in 2013, a low point of the company. Since then, management has been working flat out to restore the group’s probability and reputation. It earned £349m in 2018 and analysts believe net income could rise to £515m or 48.8p per share by 2020. Based on these forecasts, the stock is trading at a forward P/E of 10.8.

On top of this, RSA’s dividend credentials have been restored. Analysts are expecting the company to distribute 25.7p per share to investors this year, giving a dividend yield of 4.9% on the current price. The payout is expected to grow a further 18% in 2020, leaving the stock yielding 5.7%.

Cash cow

The third FTSE 100 dividend stock yielding more than 5% I think could be a great addition to your portfolio in September is retailer WM Morrison Supermarkets (LSE: MRW). 

City analysts believe this business will distribute 9.7p per share to investors as a dividend in its current financial year. Based on this estimate, it looks as if the shares could yield 5.4% on a forward basis. 

What I like about this retailer is its cash generation. Morrison’s has produced £250m in free cash flow per annum on average for the past two years, easily enough to cover the annual dividend.

On top of this, the group’s balance sheet is much stronger than most other retailers. Net gearing, the ratio of net debt to shareholder equity, was just 22% at the end of fiscal 2019, down from 60% at the end of fiscal 2014. 

The combination of this healthy balance sheet, robust free cash flow and Morrison’s fiscal responsibility, leads me to conclude this dividend champion could be a fantastic addition to your portfolio. 

The post 3 FTSE 100 dividend stocks yielding more than 5% I would buy in September appeared first on The Twelfth Magpie.

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Rupert Hargreaves owns no share 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.

Wealth creator

St James’s Place (LSE: STJ) is one of the largest and fastest-growing wealth managers in the UK. The company has more than £100bn in assets under management, and several thousand wealth advisors working for the group across the country.

There’s a steady stream of UK independent wealth managers and advisors who are giving up independent operations and moving to companies like these. These bigger businesses can handle the rising compliance demands and extra costs most wealth managers now have to comply with better than independent operators. This flow of advisors is bringing a steady stream of business to St James’s. The advisors usually bring their customers with them, who are then encouraged to invest in the group’s range of funds.

So far, this approach seems to be working exceptionally well. As St James’s has grown over the past 10 years, shares in the company have surged higher. Investors who bought the wealth manager 10 years ago have seen an annualised return of 21.2%, including dividends, on their money.

Its dividend growth has been particularly impressive. The firm’s payout to investors has grown at a compound annual rate of 25% for the past six years. The stock currently supports a dividend yield of 4.7%. As more and more people turn to St James’s to manage their money, I believe the trend of growing dividends and the rising share price will continue. This the perfect income stock for Stocks and Shares ISA, in my mind.

Booming market 

I’m also positive on the outlook for corrugated packaging producer DS Smith (LSE: SMDS). Just as I believe the steady flow of wealth managers moving to St James’s will continue to drive the group’s growth, I reckon the booming demand for e-commerce will continue to drive growth at DS.

As e-commerce has boomed over the past five years, the demand for packaging has also exploded. Its is just one of the handful of companies that have been able to profit from this trend. If City analysts’ forecasts are to be believed, the firm will earn a net profit of £475m in its current financial year, up nearly 200% in six years. On top of organic growth, DS has completed a steady stream of acquisitions over the past few years. These deals have helped the group reinforce its position in some markets, while it expands into others.

The net result of this organic and bolt-on expansion is that DS’s earnings per share have grown at a compound annual rate of 13% since 2013, while the dividend per share has risen at 12%. Right now, the stock trades at a discount forward P/E of 10.5 and yields 4.5%. I think this is a bargain price to pay for this packaging business that doesn’t look as if it will slowing down anytime soon.

The post £1,000 to invest in the FTSE 100? Here are 2 dividend stocks I’d buy for an ISA right now appeared first on The Twelfth Magpie.

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Rupert Hargreaves owns no share mentioned. The Motley Fool UK has recommended DS Smith. 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.

However, it’s not just Woodford investors that will be impacted by this suspension, as it’s likely to have implications for a number of popular FTSE 100 stocks. Here’s a look at three stocks that could be affected.

Hargreaves Lansdown

Online broker Hargreaves Lansdown (LSE: HL) is one company that could certainly be impacted by the suspension. That’s because, despite the fund’s shocking recent performance, the broker continued to include it in its Wealth 50 list of top fund recommendations.

This raises questions over conflicts of interest and the quality of Hargreaves’ advice. As Gavin Lumsden, editor-in-chief at Citywire said: “While Hargreaves Lansdown’s reputation for service is undimmed, the credibility of its investment guidance and stewardship of customers is damaged.”

Today, Hargreaves has dropped the fund from its Wealth 50 list. However, the stock is down more than 4% on news of the suspension, and I wouldn’t be surprised if the shares fall further in the short term while the issue remains in the headlines. From a long-term view, however, I remain bullish on Hargreaves shares and, in my opinion, any short-term weakness could be a buying opportunity.

St. James’s Place

In a similar position is wealth manager St. James’s Place (LSE: STJ), for whom Woodford manages around £3.5bn. Its shares have also taken a hit today. While many other wealth managers have abandoned Woodford in the recent past due to his poor performance, St. James’s Place has continued to back the portfolio manager.

Indeed just last week, St. James’s Place’s chief investment officer Chris Ralph told the Financial Times while the group was closely monitoring the fund manager’s performance amid withdrawals from investors, it remained “confident in Neil Woodford and his ability to manage our clients’ money as mandated.”

And the company later issued a statement saying it had no plans to change Woodford’s mandate. This faith in the struggling portfolio manager may hurt the group in the short term although, like Hargreaves, I continue to see long-term appeal in the shares.

Imperial Brands

Finally, the suspension could actually be good news for tobacco giant Imperial Brands (LSE: IMB). Imperial’s share price has taken a big hit in the last year, and this may be partly related to Woodford’s selling activity.

This time last year, Woodford’s Equity Income fund was worth around £7bn and Imperial Brands was a top holding at around 7-8% of the fund. This means Woodford had over £500m invested in the tobacco company. Now, however, the fund is worth around £3.7bn and the weighting in Imperial is only around 3%, which equates to a holding worth a little over £100m. This suggests to me Woodford has had to dump a large number of Imperial shares to meet clients’ redemptions and this won’t have helped IMB’s share price.

Interestingly, Imperial is up over 2% today. With Woodford no longer forced to sell the stock, perhaps the tide is about to turn for the out-of-favour tobacco giant? 

The post 3 FTSE 100 stocks that could be impacted by the Neil Woodford news appeared first on The Twelfth Magpie.

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Edward Sheldon owns shares in Hargreaves Lansdown, St. James's Place and Imperial Brands. The Motley Fool UK has recommended Hargreaves Lansdown and Imperial Brands. 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.

However, a better buy for a portfolio could be AFH Financial (LSE: AFHP) and today I’m going to explain why I believe St. James’s Place’s time in the sun could be coming to an end.

Record performance

On the face of it, St. James’s looks as if it is firing on all cylinders. At the end of April, the company reported that after a strong first quarter, funds under management had reached an all-time high of £103.5bn at the end of March, up from £95.6bn at the end of 2018. Net inflows of £2.2bn and net investment gains of £5.8bn helped power the business to this record level.

Commenting on the numbers at the end of April, chief executive Andrew Croft said, “There remains both a growing market for trusted face-to-face advice in the UK and an advice gap that represents a major opportunity for us.“

The growing market also presents a substantial opportunity for AFH Financial. Today the company reported that for the six months ended 30 April, funds under management increased 68% to £5.4bn, boosting revenues and statutory profit after tax by 61% and 80% respectively.

Management believes this is just the start of the group’s growth. It is targeting assets under management of £10bn within three to five years, growing revenues from £37m to £140m at the same time.

A key advantage 

These may seem like unrealistic targets for this relatively small wealth management group, but the company has one key advantage over its larger competitor that I think will help it achieve its aspirational objectives; lower fees.

Towards the end of the last year, AFH decided to scrap its annual platform fee for new clients. The company is also committed to reducing costs for clients over time as it accrues more assets and can achieve economies of scale. In comparison, St. James’s charges an eye-watering 4.5% of savers’ initial investment, which will “be used to pay for initial advice” with a further annual fee of 0.5%, that’s excluding product charges of around 1% per annum.

Some analysis suggests clients could be paying as much as 7.14% in fees every year to St James’s. These fees go some way to explaining why it was one of the most complained about wealth managers in the UK last year.

Better value for money 

If AFH continues to offer clients a cheaper alternative, then I think the stock is worth backing for the long term as it continues towards its growth objectives. What’s more, even though it might not offer the same level of income, the stock is currently dealing at a forward P/E of just 10.2, compared to26 for  St. James’s.

Based on these numbers, AFH looks to me to offer better value for both investors and clients alike.

The post A FTSE 100 income star yielding 5% I’d sell to buy this dividend growth stock appeared first on The Twelfth Magpie.

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Rupert Hargreaves owns no share 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.

Turnaround

Sure, Tesco shares have enjoyed a fantastic run this year. The share price is up around 25%, meaning it has outperformed the FTSE 100 by a wide margin. Full-year results looked pretty good too. Like-for-like sales for the year ending 23 February were up 2.9%, while group operating profit surged 34%. The company hiked its dividend by 92% as well, which was great news for shareholders. CEO Dave Lewis has certainly done a good job of turning the supermarket around.

However, looking ahead, I can’t help but think that the business environment for Tesco looks challenging. For example, Aldi and Lidl plan to open hundreds of new stores in the next few years, which could hamper Tesco’s growth strategy, particularly if the economy takes a turn for the worse and consumers seek out lower-cost products. Interestingly, Aldi just opened a new ‘local’ concept store in South London right near me (I’ve been in several times and it’s always busy) which suggests that the low-cost supermarket (named Grocer of the Year last year) has more tricks up its sleeve.

Additionally, Amazon is now attempting to gain market share through its AmazonFresh subsidiary, which enables you to buy a broad range of products at low prices and have them delivered directly to your door. Given this level of competition, I’m not so bullish on Tesco’s long-term prospects. The shares don’t look particularly expensive (trailing P/E 15.5, yield 2.4%), but they don’t jump out at me as a strong buy.

Major opportunity

One FTSE 100 dividend stock that I do think has bright prospects right now is wealth manager St. James’s Place (LSE: STJ). The group specialises in providing trusted face-to-face financial advice to individuals and businesses, and demand for its services is strong, driven by the complexity of today’s financial environment. According to CEO Andrew Croft, there remains both a growing market for trusted face-to-face advice in the UK as well as an “advice gap” and that represents a “major opportunity” for the group.

A recent trading update showed that the FTSE 100 wealth manager has solid momentum at the moment. In the first quarter of 2019, the group received gross inflows of £3.6bn, taking its total funds under management to a record £104bn, while the client retention rate was a high 95.9%, which suggests that clients are very happy with the company’s services.

Of course, there are risks to the investment case here too and one risk is the growing threat of ‘robo advice’. This is where people receive financial advice from digital wealth managers with minimal human intervention. However, while this will suit some people, many (particularly the older generation) still prefer face-to-face advice when it comes to money, so I don’t think the group’s services will become obsolete any time soon.

St. James’s Place has been a fantastic dividend stock in the past as the company has lifted its payout substantially in recent years and right now, the stock offers an attractive prospective yield of 4.3%. I think that high yield is a steal, so I’d pick STJ shares over Tesco shares despite the stock’s higher P/E ratio of 19.

The post Tesco shares? I’d rather buy this FTSE 100 dividend stock appeared first on The Twelfth Magpie.

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Edward Sheldon owns shares in St. James's Place. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool UK owns shares of and has recommended Amazon. The Motley Fool UK has recommended Tesco. 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.

One such company is Diageo (LSE: DGE), with the alcoholic beverages stock having a price-to-earnings (P/E) ratio of over 25 at the present time. Despite its high valuation, the company’s growth rate could prove to be impressive, as well as resilient. As such, it could be worth buying alongside another highly-rated FTSE 100 stock that released an update on Tuesday.

Growth potential

The company in question is wealth management business St. James’s Place (LSE: STJ). It has experienced an encouraging start to the year, with gross inflows of £3.61bn being only slightly down on the £3.91bn recorded in the same period of the previous year. Alongside strong retention, net inflows during the period were £2.18bn. This equates to 2.3% of opening funds under management, which highlights the robust performance of the business during what has been an uncertain period for the wider wealth management industry.

Looking ahead, St. James’s Place is forecast to post a rise in its bottom line of 20% in the current year. Therefore, while it trades on a P/E ratio of 21, its price-to-earnings growth (PEG) ratio is little more than 1. This suggests that the stock could offer good value for money. Alongside this, the stock has a dividend yield of 5%, which could mean that its total return is highly impressive over the long run.

Robust prospects

While Diageo’s valuation may be high, it has a long track record of generating impressive financial performance. Its current strategy could continue this trend, with significant investment in growth markets across the emerging world providing it with a strong foothold at a time when wages are moving higher.

The company has put in place a more efficient business model that is increasingly focused on a smaller number of brands. Certainly, it still has a wide portfolio of beverages, but is now able to focus investment in areas that could offer higher growth rates. This may lead to an increasingly dynamic performance from the business, and could allow it to generate an improving rate of earnings growth.

With Diageo expected to post a rise in earnings of 7% in the current year, there are other stocks in the FTSE 100 that offer higher growth rates. However, with the prospects for the world economy being uncertain due to the potential for a full-scale trade war, there may be few shares that offer such resilient growth. As such, the stock seems to be worthy of a premium valuation, and could outperform the FTSE 100 over the long run. This means that now could be the right time to add it to a Stocks and Shares ISA.

The post Why I’d snap up FTSE 100-member Diageo’s share price for my Stocks and Shares ISA appeared first on The Twelfth Magpie.

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Peter Stephens owns shares of Diageo. The Motley Fool UK has recommended Diageo. 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.

With that in mind, today I’d like to highlight three FTSE 100 companies that recently announced dividend increases.

Mondi

Let’s start with packaging firm Mondi (LSE: MNDI) – a company that I believe offers considerable investment appeal when you consider the huge growth in online shopping in recent years and the subsequent increase in demand for cardboard packaging.

Recent full-year results here were excellent, with basic underlying earnings per share climbing 27%, and this strong performance resulted in the company announcing a dividend increase of an impressive 23%. That’s a fantastic result for shareholders and marks nine consecutive dividend increases for the group, with the payout rising 700% over the last nine years.

Is Mondi a good dividend stock to own? In my view, yes it is. Its yield is almost 4%, dividend coverage is strong, and the stock’s valuation is very reasonable (forward P/E of 11). I continue to rate the stock as a ‘buy’ despite concerns that global growth could moderate this year.

St. James’s Place

I was also impressed with the recent St. James’s Place (LSE: STJ) full-year results. The FTSE 100 wealth manager reported solid growth and announced a 12.5% increase in its full-year dividend in late February, despite the well-documented global equity market sell-off late last year. That’s a great result in challenging market conditions.

To my mind, St. James’s Place might just be one of the FTSE 100’s best-kept DGI secrets. An analysis of the group’s dividend growth track record reveals that it has now notched up 15 consecutive dividend increases (and never cut its payout) and that over the last 10 years it has lifted its payout by an incredible 995%.

STJ shares experienced a significant pullback in the second half of 2018, and while they have rebounded this year to a degree, I continue to see appeal at current levels, as the prospective yield for FY2019 is a high 5.1%. The group looks well placed to help retiring baby boomers with their financial planning needs in the years ahead in my opinion.

Prudential

Lastly, financial services group Prudential (LSE: PRU) has also announced a dividend hike, increasing its payout by 5% to 49.35p per share yesterday. The group also reported an above-forecast 6% increase in operating profit for the year and a 26% increase in diluted earnings per share.

Prudential is another stock with an impressive dividend growth track record, having now notched up 14 consecutive dividend increases. And I think the company should be able to continue increasing its payout going forward. Not only is the group well positioned for growth due to its exposure to Asia, but the company’s dividend coverage is high (a ratio of nearly 2.4 for FY2018), which suggests the group has the capacity to increase its dividend even if earnings stall.

Currently trading on a forward P/E of 10.6 and sporting a prospective yield of 3.3%, I believe Prudential shares offer appeal at present.

The post 3 FTSE 100 stocks that just increased their dividends appeared first on The Twelfth Magpie.

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Edward Sheldon owns shares in Mondi, St. James's Place and Prudential. The Motley Fool UK has recommended Prudential. 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.

This could mean that its risk/reward ratio is more appealing than investing through a cash ISA, where the potential returns available are around 1.5%. Alongside another FTSE 100 stock which released an update on Wednesday, the company could be worth buying for the long term.

Improving prospects

The other company in question is wealth manager St. James’s Place (LSE: STJ). Its annual results showed it has performed well at a time when the wider financial services sector has experienced an uncertain period.

For example, it reported a rise in gross inflows, increasing to £15.7bn from £14.6bn in the previous year. Its funds under management also increased to £95.6bn from £90.7bn a year ago. Meanwhile, underlying operating profit increased 9% to £1,002m, with underlying cash earnings per share rising by 10% to 58.7p.

Looking ahead, the stock is forecast to post a rise in earnings of 20% in the 2019 financial year. Despite this, it has a price-to-earnings growth (PEG) ratio of just 1.2, which suggests it may offer a wide margin of safety.

One reason for its low valuation is its share price decline of 16% in the last year. Although further falls in the stock price cannot be ruled out, St. James’s Place appears to have a sound strategy and could deliver a successful recovery over the medium term.

Changing business

While utility companies are usually desired for their relative stability, SSE is undergoing a period of intense change. The process of disposing of its domestic energy supply division has been somewhat long-winded, with plans to merge it with npower falling through. It’s now assessing its options, and is likely to make a decision on how to dispose what could be a challenging business over the medium term. For example, political risks are high, while price caps could signal lower levels of profitability are ahead for the sector.

As such, the company’s renewables division could become an increasingly desirable place to invest. SSE has a strong foothold in the green energy industry, and this could help to catalyse its financial and stock price performance in the long run.

In the meantime, the company has a dividend yield of around 7.1%. It also plans to raise dividends by at least as much as inflation over the next few years, which could become increasingly appealing to investors should the UK economy experience a challenging period. As such, after a disappointing year which has seen its share price come under pressure at times, now could be the right time to buy.

The post I would dump the cash ISA and pick up SSE’s 7%+ dividend yield appeared first on The Twelfth Magpie.

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Peter Stephens owns shares of SSE. 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 asset manager’s performance remains resilient despite weakness across global investment markets and total inflows in 2018 rose 8% to £15.7bn, according to financials released last month. But inflows slowed markedly in the final two months and pointed to a much tougher climate that it’ll have to navigate this year. 

What’s encouraging, though, is the way St. James’s Place is able to offset the worst of these tough conditions through its impressive client retention skills. It’s one of the reasons why City analysts still expect earnings to keep growing this year and next. And in my opinion it’s in great shape to keep growing profits over the long term as it expands its operations to latch onto growing demand for investment advice in the UK.

Dividend chasers will be cheered by news that dividends are expected to keep growing over the medium term too, and a chubby 5.4% for 2019 is available to tap into right now because of the anticipated 51.5p per share total payout.

Flying high

Airlines have been suffering from increased fuel costs over the last year, putting immense pressure on margins. International Consolidated Airlines Group (LSE: IAG) is expected to see earnings flatline on a year-on-year basis by City brokers in reflection of these obstacles, with the cheap airfare environment in Europe predicted to add some strain too.

Despite this, the FTSE 100 flyer is still anticipated to keep raising the annual dividend and a total reward of 31 euro cents per share is being tipped, a figure that creates a gigantic 4.2% yield. Its increasing exposure to the rocketing budget segment is setting it up to deliver strong profits growth in the years ahead, as are the measures it is taking to boost its fleet size and route network. I’m confident that it will have the confidence and the strength to continue hiking dividends long into the future.

Its failure to snap up Norwegian Airlines may have been disappointing but tough conditions for Europe’s budget flyers will no doubt present fresh opportunities for IAG to expand its operations through acquisition activity.

Board games

Concerns over developing oversupply in the containerboard market may have smashed Smurfit Kappa Group’s (LSE: SKG) appeal with investors last year, but its rising share price more recently suggests that the investment community has finally woken up and smelt the coffee.

The threat of rising supply from Chinese producers is a setback but it’s by no means catastrophic for the likes of Smurfit Kappa. Through the strength of its market-leading products, as well as its broadening geographic footprint (it made significant acquisitions in France, The Netherlands and Serbia last year alone), it can continue to command strong demand from its customers, in my opinion.

Besides, it’s doubling down on efforts to boost profit margins and helped by recovering input costs, these jumped 280 basis points in 2018 to 17.3%, providing more reason to be optimistic over its long-term growth prospects.

City analysts are predicting additional dividend raises for 2019, to 102 euro cents per share. And this creates a tasty 3.9% yield.

The post 3 top FTSE 100 dividend stocks I’d buy right now appeared first on The Twelfth Magpie.

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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.