Let’s see.

What?

Telecom Plus (LSE:TEP), which trades as Utility Warehouse, describes itself as a “unique platform for bundling subscription-style essential household services”. What does this mean? It sells energy, telephone and broadband contracts, and home insurance.

During the year ended 31 March 2025 (FY25), the biggest contributors to revenue were electricity (49%) and gas (34%) sales.

More recently, its FY26 year-end trading update said its adjusted profit before tax was expected to be at “the bottom end” of guidance. It blamed reduced energy consumption following an “unseasonably warm winter”.

Fluctuating energy usage and fierce competition in all of its markets are the group’s principal challenges. Annual contracts help to ensure a certain degree of customer stickiness but there are plenty of rivals looking to take market share across all its divisions.

A strong track record

Despite this, the group’s consistently raised its adjusted earnings per share (EPS) since 2021:

• 2025 – 117.7p
• 2024 – 107.7p
• 2023 – 97.7p
• 2022 – 63.0p
• 2021 – 57.2p

Over this period, its full-year dividend has increased by 65%.

But following discussions with shareholders, the group’s going to change its distribution policy. It intends to continue returning 80% of its post-tax profit to shareholders. However, in future, it will be split between dividends (at least 50%) and share buybacks. This means the yield from its dividend could fall. By how much? It’s hard to know.

Positively, customer numbers increased by 23% to 1.43m in FY26. This includes 193,000 that are being migrated from TalkTalk. Excluding this, there was a 10% rise.

Looking at its balance sheet, its ratio of net debt to adjusted EBITDA is 1.1, up from 0.8 a year earlier. Most of the increase was caused by the TalkTalk deal. Even so, a ratio of around one doesn’t seem excessive to me. In theory, it means it could clear its debts in one year from its operating cash flows.

What’s not to like?

A loss of confidence?

Unfortunately, its share price appears to be in decline. In November 2022, the group’s stock was changing hands for around £25. Today (15 June), it’s around 60% lower.

This appears to coincide with the introduction of the government’s Energy Price Guarantee, which limited the increase in energy bills following a global gas price spike. But this was funded by the taxpayer, not energy suppliers, and expired in 2024.

The Ofgem price cap remains. But this has been around since 2019.

It’s almost as though I’m missing something obvious. Yes, customer growth is slowing, but as we’ve seen, EPS is rising.

Using its unadjusted EPS, its price-to-earnings ratio of 10.4 is well below its five-year average of 20.74, which could be a good entry point.

A final thought

To be honest, its falling share price makes me anxious. Until I’m convinced that Telecom Plus will be able to change investor perceptions, I don’t want to invest.

As attractive as its yield might be, the FTSE 250 stock’s not for me. Instead, I reckon there are better opportunities to consider elsewhere. In fact, there are 11 stocks on the index that are currently yielding 9% or more.

Should you invest £5,000 in Telecom Plus Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Telecom Plus Plc made the list?

James Beard does not own shares in any of the companies mentioned.

The post This income stock’s yielding an amazing 9.5%! appeared first on The Twelfth Magpie.

Since launch day, Telecom Plus has soared 380%. It’s outstripped the FTSE 250 so far this century, even though the mid-cap index hasn’t done so badly itself. And in that time, it’s turned into a bit of a dividend monster too — with a healthy 6.9% yield forecast for the current year.

Not a bed of roses

The past few years, however, haven’t been all sunshine. The share price has plunged 60% since the peak it hit at the end of 2022. Early investors who managed to sell back then could have tucked away a 12-bagger since flotation day.

But the share price fall is part of the reason for today’s fat dividend yield. So, is the decline just a result of a growth stock passing its peak as it enters maturity? Or has something actually gone wrong? And does this look like one of today’s best stocks to buy?

We’ve had one, hopefully short-term, disappointment ahead of full-year results…

Adjusted pre-tax profits for FY26 are expected to be at the bottom end of our previously guided range of £132m-£138m, following reduced energy consumption during an unseasonably warm winter.

— Year End Trading Update, 28 April 2026

What does it do?

Under the Utility Warehouse brand, Telecom Plus combines energy, telecommunications and insurance offerings all in one. It doesn’t spend loads on fancy advertising, relying mainly on word of mouth. And it’s built up an impressively loyal customer base. Customer retention and operational costs are among the best in the business.

That business model, though, faces pressure at times of high energy prices and lower demand. And as a smaller company with a market cap of around £800m, we might not see the same resilience as bigger FTSE 100 competitors. That could be a worry.

It also disturbs me a little to see debt building up on the balance sheet. Analysts expect net debt to reach £148m this year — up 28% in a year, and more than twice where it was in 2022. I’m always nervous when I see dividends and debt growing hand in hand.

So what should investors do?

Is the current pessimism overdone? Looking at forecasts and valuation, I think so. Here’s how things look…

• Forecast price-to-earnings (P/E) ratio of 9.0, and falling.
• Forecast dividend yield of 6.9%, and rising.
• Strong Buy consensus with average price target of 2,050p.

That average target is around twice the current price. And even the most pessimistic broker of the five I can find offering recommendations sees a 28% gain on the cards.

So, tough times for the energy business — but upbeat forecasts. Is this a stock that both dividend and growth investors should consider? I think so. But I’m waiting to see full-year results due on 23 June.

Should you invest £5,000 in Telecom Plus Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Telecom Plus Plc made the list?

Alan Oscroft does not hold any positions in the companies mentioned.

The post With a 6.9% yield, is this one of the best UK dividend stocks to buy right now? appeared first on The Twelfth Magpie.

Telecom Plus (LSE: TEP) stands out thanks to its unusually sticky customer base and long record of steady cash generation. With dividends covered by resilient earnings and a business model built for consistency, it looks a rare combination of quality and yield.

So how much second income from dividends could investors make from it over time?

How do the dividend forecasts look?

Over the past five years (from the start of 2021), the utilities and telecoms giant increased its dividend from 57p to 94p.

That generated respective average annual dividend yields of 4.5%, 3.7%, 4.2%, 5.1%, and 5.4%. These yield variations, despite rising dividends, illustrate how they can go up and down over time.

Nonetheless, analysts forecast its dividend yield will be 7.4% this year, 7.7% next year, and 7.8% in 2028.

What does this mean for dividend income?

As a long-term investor, I always judge a firm’s dividend returns profile over a 30-year investment cycle. The period incorporates first investments made around 20 and early retirement options appearing at about 50.

In Telecom Plus’s case, a £20,000 investment at the forecast 7.8% dividend yield would make £23,519 in payouts after 10 years. This also assumes the dividends are reinvested into the stock — a process known as dividend compounding. It is like leaving savings to grow in a bank account, but its effect on dividend returns over time can be extraordinary.

After 30 years on this basis, the dividend payouts would rise to £186,058. The total value of the holding by then (including the £20,000 stake) would be £206,058. And that would generate a yearly income (from dividends alone) of £16,073.

Does the core business support such payouts?

The firm is best known for its Utility Warehouse brand. It is the UK’s only multi-service utility provider, bundling all four core home services (energy, communications, mobile, and insurance) — into a single bill. This business model has led to unusually high customer retention and lower operational costs.

A risk here is a shift in utility regulation or commission structures that could squeeze margins. Another is that rising wholesale energy costs or supply‑chain pressures could pressure profitability.

Nevertheless, analysts forecast the firm’s profits will rise by an average of 7.8% a year to end-2028 at lease. And it is this that ultimately drives any firm’s dividends higher.

My investment view

For income investors, that combination of dependable earnings growth, high customer loyalty, and proven dividend record is hard to overlook. The company’s subscription‑style model gives it a level of visibility that many high‑yield stocks simply lack.

With payouts rising steadily and the underlying business continuing to expand, the shares offer a rare blend of stability and long‑term income potential. For those seeking a reliable second income stream, I think it is a stock that merits serious consideration.

I would buy it but I already have a holding in BT. Buying another stock in the sector would unbalance my portfolio. Given that, I have my eye on other high-yielding stocks in different sectors that look very undervalued.

Should you invest £5,000 in Telecom Plus Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Telecom Plus Plc made the list?

Simon Watkins owns shares in BT.

The post A 7.8% forecast dividend yield! 1 income share I wish I could buy today! appeared first on The Twelfth Magpie.

This is not only exempt from income and capital gains tax but also has no age-related restrictions on withdrawals. So, unlike private pensions, I could withdraw this ISA money anytime and in any amount with no tax penalties.

But what sort of returns am I targeting in my latest Stock and Shares ISA?

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, nor does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

A better return than the ‘risk-free rate’?

There is more risk involved in share investment than there is in investing in the UK 10-year government bond, known as the ‘risk-free rate’.

And currently, it delivers an annual yield of 5.1%, although the interest rate (coupon) on bonds — just like with shares — can go up and down over time.

Nevertheless, at the current rate with the returns compounded (reinvested into the bonds), I could make £13,270 after 10 years. And this would rise to £72,065 after 30 years. And at the end of that time, I could have a monthly income from the interest of around £306.

Incidentally, gilts can be included in a Stock and Shares ISA. So, it is a straight comparison of risk and reward.

What are the FTSE options here?

Happily, several shares in the FTSE 100 and FTSE 250 deliver much higher annual returns than this. One is the UK’s only integrated multi-utility provider, Telecom Plus (LSE: TEP).

It is best known for its Utility Warehouse brand, but what really sets it apart is its bundled‑services model. Instead of selling energy separately like traditional suppliers, it wraps broadband, mobile, insurance and home energy into a single package. That keeps customers loyal and cash flows steady.

A risk here is any slowdown in customer acquisition or partner recruitment that could weaken the growth model. Another would be rising wholesale energy or telecom costs that could squeeze its margins.

However, the company’s mix of essential, everyday services creates unusually strong recurring earnings. Indeed, analysts forecast these will rise by 9.8% a year on average over the medium term, at minimum. And this is exactly the kind of foundation that supports a dependable and rising dividend profile.

How much in dividends over time?

Telecom Plus’ dividend yield is forecast to hit 9.4% next year, 10% in 2028, and 10.6% in 2029.

So, a £20,000 holding in the firm on the projected 10.6% as an average (and including ‘dividend compounding’) could make £32,035 after 10 years. And after 30 years on the same basis, this dividend gain could rise to £332,226.

By that point, the holding’s total value could be £352,226. And that would deliver a monthly passive income (from dividends) of £3,111!

My investment view

My holdings in other telecoms and energy firms (BT, BP, Shell, Harbour Energy) preclude me from adding another in the same sector. To do so would unsettle my portfolio’s risk/reward balance.
Instead, I have my eye on other high-yielding stocks that also look cheap to me at their current price.

However, for investors considering it without this problem, I think Telecom Plus offers the rare mix of stability, growth and income that long‑term ISA investors often struggle to find.

The post How much is needed in a Stocks and Shares ISA to target a £3,111 monthly passive income? appeared first on The Twelfth Magpie.

Its business model is built on recurring revenue, low customer churn, and strong cash conversion, giving it the sort of stability that income investors such as me crave.

So, what is the stock and how much could investors make from it?

Telecoms to energy stock

The company behind those numbers is Telecom Plus (LSE: TEP), the FTSE firm best known for its Utility Warehouse brand. Unlike traditional energy suppliers, it operates a bundled‑services model that keeps customers loyal and cash flows predictable.

And it covers everything from broadband to mobile to home energy. That mix of essential services creates unusually strong recurring revenue — exactly the foundation that supports a rising dividend profile.

A risk to these is any regulatory changes affecting household utility pricing or commissions, which could dent earnings. And this is ultimately what powers any firm’s dividends (and share price) over time. Another would be increased competition that could squeeze margins.

However, consensus analysts’ forecasts are that Telecom Plus’s earnings will rise by an average 10% a year over the medium term.

Rising dividends from a high base

The UK’s only integrated multi-utility provider currently generates a dividend yield of 6.9%. This is more than double the current 3.4% average dividend yield of its home FTSE 250 index.

However, analysts project the dividend will rise to 101.4p this year, 110.2p next year, 118p in 2028, and 124p in 2029.

These would generate respective dividend yields of 7.5%, 8.1%, 8.7%, and 9.1% on the current £13.60 share price.

How much dividend income can be made?

A £20,000 holding in Telecom Plus could make investors £29,516 in dividends after 10 years and £283,516 after 30 years. This period is commonly seen as the standard investment cycle for long-term investors. It begins with first investments around 20 and ends in early retirement options around 50.

These numbers assume the forecast 9.1% as the average yield (but this could go down or up over time as well as many other changes happening to the company). They also factor in the dividends being reinvested back into the shares to capture the turbocharging effect of ‘dividend compounding’.

Including the original £20,000 investment, the holding could be worth £303,516 by the end of 30 years. At that point, it could be producing a passive annual income of £27,620 from dividends alone!

My investment view

For me, Telecom Plus is the kind of income share that is very hard to overlook.

Its starting yield near 7%, backed by recurring revenue and a long record of dependable payouts already puts it in rare company. And the prospect of that rising towards 9%+ over the coming years only strengthens the case.

My existing stake in another firm in the telecoms sector — BT — precludes me from buying it currently. To do so would unsettle the risk/reward balance of my portfolio. But for long‑term investors who want growing passive income from a stable, essential‑services business, it seems well worth a closer look.

The post A 9.1% forecast yield! 1 under-the-radar FTSE income share to buy today? appeared first on The Twelfth Magpie.

This is where things get interesting. Some analysts now believe a handful of mid‑cap names could double or more over the next year. Three that keep popping up in my stock screener are Telecom Plus (LSE: TEP), Craneware, and GlobalData (LSE: DATA).

But cheap does not automatically mean good value. So it is worth lifting the bonnet and checking what we’re really looking at.

Telecom Plus

Telecom Plus is a multi‑utility provider selling gas, electricity, broadband, and phone contracts under its Utility Warehouse brand. It is unusual in that it grows mainly by word‑of‑mouth referrals, which helps keep marketing costs down and customers sticky. On paper, it looks very appealing for a defensive business: a 7.56% dividend yield, a solid price-to-earnings (P/E) ratio of 15.7, and a chunky 28.8% return on equity (ROE).

The main risks are that utilities are tightly regulated and competition is fierce. With an historically high payout ratio, some have questioned just how far that big dividend can stretch if growth slows.

Still, analysts are optimistic, with the average 12‑month price target expecting 100% growth from here. That suggests the market might be underestimating its ability to keep adding customers and turning that into profit.

Craneware

Craneware sells management software to hospitals for billing, pricing, and reimbursement – a niche, but important, part of the healthcare system. Earnings are up 45% year on year, helped by rising revenue, strong margins around 30%, and ongoing demand as hospitals digitise their back‑offices.

On top of that, Craneware has very little debt compared to equity, which gives it more resilience if interest rates stay higher for longer. The flip side is that the shares already trade on a high valuation and can be volatile – any slowdown in US hospital spending or IT budgets could quickly knock sentiment.

GlobalData

GlobalData is a data and analytics group that sells subscription research to companies and governments across sectors like healthcare, technology, and consumer goods. In its latest year, it delivered 12.8% revenue growth, helped by recent acquisitions and an ‘AI‑first’ push to make its platform more useful to clients.

Earnings are up 16.7% so far this year, and analysts see scope for further margin expansion as management executes its growth plan. The debt‑to‑equity ratio of 0.63 is manageable, but it’s higher than Craneware’s, so the balance sheet is not quite as pristine.

Key risks here are that some of that growth has come from deals rather than pure organic progress. If a recession rears its ugly head, data and research spending could be cut, hurting profits.

Final thoughts

All three shares have credible growth opportunities, but Telecom Plus stands out to me as one worth considering. It combines essential services, strong profitability, and a very generous yield.

All that at a valuation that doesn’t look too stretched for a potential long‑term compounder.

Of course, none of these should be ‘bet the farm’ ideas. But as part of a diversified portfolio – especially inside an ISA where gains and dividends are shielded from UK tax – a careful allocation could add some real excitement to long‑term returns.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

The post 3 FTSE shares tipped to grow 100% (or more) in the next 12 months appeared first on The Twelfth Magpie.

But with valuations stretched and US GDP growth forecast at only 2%-2.5%, analysts don’t expect the same in 2026. Overall, the Dow isn’t expected to grow more than 10% in a best case scenario, with lower forecasts predicting only 3% growth.

These three high-yielding UK shares are forecast to grow far more.

Kainos

Kainos (LSE: KNOS) helps big firms like the NHS or banks to upgrade their digital systems, especially with Workday software for payroll and HR. It’s been growing revenue steadily the past few years, with increasing public sector deals and cloud demand as UK government tech expenditure grows.

Analysts forecast average price growth of around 67% in the coming 12 months. The 4% yield’s reliable too, covered by cash flow even after five years of increases, and shares trade on a fair-ish multiple around 29 times earnings. 

Still, it faces stiff competition from lower-cost alternatives in regions like India. If the economy dips, tightening budgets could send clients looking elsewhere. Still, the combination of growth and income makes it worth considering in my book — even with the tech-cycle wobbles.

Telecom Plus

Think of Telecom Plus (LSE: TEP) as a one-stop shop for broadband, mobile, gas, and electric. By bundling bills together, it saves customers cash and builds loyalty. The latest half-year results showed steady profits despite energy price swings, with dividends up 13% last year to a near-7% yield. Cash coverage is a bit thin at only 1.2 times but is backed by 25 years of payments.

Plus, the average 12-month analyst forecast is 68% higher than today’s price. That’s a chunky combo of income and growth!

But it’s a competitve sector, with rivals Octopus and Bulb muscling in on its market share. On the plus side, falling wholesale energy costs should boost profits as UK households switch. But any change in regulations could further pressure margins. 

For now, the balance sheet looks solid and cash generation is promising. For investors seeking dependable income with growth potential, it’s a strong contender to consider.

MONY Group

MONY Group (LSE: MONY) operates price comparison sites like MoneySuperMarket, helping customers find the best deals on loans, insurance, and broadband. Revenue recently ticked up 1% to £225m amid car insurance woes while EBITDA rose 2% and SuperSaveClub membership hit 1.5m, now 14% of sales.

The core attraction here is the stock’s 8.2% yield, but the average 57.5% growth forecast is a big bonus. Analysts have cited potential UK rate cuts as driving interest in switching providers.

But lately, AI-driven comparisons and fierce Google ad competition threaten its business model. If consumer spending softens, it could stall traffic and impact profits.

While the growth narrative is lower here, the yield is undeniably attractive for UK income hunters. It’s long been a favourite of mine and the current low price also makes it worth considering.

The post The Dow Jones may be at 50k but these 3 UK shares are forecast to grow further in 2026 appeared first on The Twelfth Magpie.

While the share price has drifted lower of late, its dividend-yield allure has only strengthened. Resilient cash generation and a business model designed for steady, recurring revenue underpin this.

For investors prioritising passive income over price action, I believe this stock offers a rare blend of yield, stability and long‑term dependability.

So, how much could investors make from it over time?

Rising dividend yield projections

The UK’s only integrated multi-utility provider currently generates a dividend yield of 6.9%. This is nearly double the current average dividend yield of the FTSE 250 of 3.5%.

Moreover, its dividend record has strengthened meaningfully in recent years. In 2022 it was 57p, in 2023 80p, in 2024 83p, and in 2025 94p.

Looking ahead, the consensus forecast of analysts indicates that these will rise again — to 101.4p this year, 110.2p next year, and 118p in 2028. This would generate respective dividend yields of 7.5%, 8.1%, and 8.7% on the current £13.59 share price.

These levels sit firmly in the ultra‑high-yield bracket. This is a rarity across the FTSE indexes, and a key reason why I view the stock as a compelling passive‑income candidate.

How justified are these forecasts?

Rises in a company’s dividends (and share price) are ultimately powered by growth in earnings (or ‘profits’). A risk to these for Telecom Plus is intense competition cutting into its customer growth and squeezing margins.

However, analysts forecast its earnings will grow by an average of 10.3% a year to end-2028. This looks well justified to me, given the firm’s recent results.

The full fiscal-year 2025 figures saw adjusted pre-tax profit climb 8.1% year on year to a record £126.3m. Customer numbers jumped 15% to 1.163m, and the dividend increased 13.3% to the current 94p.

The company also announced a major partnership with TalkTalk. This saw the acquisition of around 95,000 fixed-line and broadband customers to which Telecom Plus can upsell additional utility services.

Management reiterated its medium-term target of 2m customers and continued double-digit growth for the fiscal-year 2026. It did the same for its adjusted pre-tax profit target for 2026 of £132m-£138m (versus £126.3m in 2025).

How much could be made over time?

A £5,000 holding in the firm would make investors £6,897 in dividends after 10 years on the forecast 8.7% yield. This assumes the dividend payout stays at its current level, although it could rise, fall, or remain unchanged.

This also assumes that dividends are reinvested back into the shares to harness the power of ‘dividend compounding’.

On the same basis, after 30 years the dividends received would total £62,358. Including the original £5,000 investment, the holding would be worth £67,358 by then.

At that point, it would be producing a passive annual income of around £5,860 from dividends alone!

My investment view

I already have a holding in the same sector — BT — so buying another might unbalance the risk-reward profile of my portfolio.

Nonetheless, I am trying to convince myself that actually it might be okay to buy it anyway for… well, some reason or another.

For those without this conundrum and looking for a strong ultra-high-yield passive‑income candidate, I think the stock is well worth considering.

The post Here’s how investors could target £5,860 in yearly passive income from £5,000 in this overlooked FTSE 250 gem! appeared first on The Twelfth Magpie.

Luckily, by planning ahead and making some prudent moves in the stock market, investors can significantly improve their odds of enjoying a fancier retirement lifestyle. With the right strategy and ISA portfolio, it’s possible (if not guaranteed) for investors to triple the 2025/26 State Pension. That’s an extra £37,644 a year entirely tax-free.

Here’s how.

Setting investment goals

The objective of this ISA portfolio is simple: generate £37,644 in annual passive retirement income. To do this sustainably, most financial advisors recommend following the 4% rule, where only 4% of a portfolio is withdrawn each year.

The idea here is to ensure wealth continues to compound even after investors start spending their fortune.

At 4%, that means a portfolio would need to be worth £941,100 to generate triple the updated State Pension. Obviously, that’s a considerable lump sum of cash. However, it’s not as impossible to obtain as most people might think.

Even when starting from scratch, drip feeding £500 each month at an average 8% return a year is enough to surpass this milestone after around 33 years. This perfectly demonstrates the importance of starting early when it comes to investing.

Yet, there are some clever strategies investors can use to drastically speed up the process.

Aiming higher

Assuming the stock market continues to grow roughly in line with its historical rate, index investors can reasonably expect to earn an average of 8% a year. But for intelligent stock pickers, the gains can be far more substantial.

Telecom Plus (LSE:TEP) serves as a perfect example to consider. Operating under the name of Utility Warehouse, the business is a bundled service provider for essentials like gas, electricity, broadband, mobile, and insurance to UK households and businesses.

This bundling model has been a bit of a secret weapon over the last two decades. It generates continuous cross-selling opportunities as well as generating high levels of customer retention. Consequently, its customer base has expanded significantly since 2005 to almost 1.4 million, with earnings still outpacing the market even in the last five years.

As a result, anyone who invested 20 years’ ago and reinvested dividends along the way has earned an average annualised return of 17.2%. Transforming £500 a month into just over £1m in the process.

Still worth considering?

As a £4.4bn enterprise, it’ll be difficult for Telecom Plus shares to generate 17.2% annualised returns for the next two decades. But that doesn’t mean it can’t continue to outshine the wider market.

Its bundling model continues to be very sticky, with customer acquisition costs plummeting, supported by growing word of mouth. There are still some notable threats and limitations, like the price caps enforced by Ofgem. And seeing the success of bundling, leading energy suppliers have begun exploring their own offerings in this space.

Nevertheless, given the group’s tremendous track record, investors seeking to secure their retirement may want to take a closer look.

The post How much do you need in an ISA to triple the 2026 State Pension? appeared first on The Twelfth Magpie.

One such opportunity has appeared in my recent research: Telecom Plus (LSE: TEP), better known as Utility Warehouse. It is the UK’s only integrated multi-utility provider, bundling energy, broadband, mobile, and insurance into one subscription.

So why has it surfaced now, and how much could it make in passive income?

On the radar

The firm has popped up on my stock screener because of a possible acquisition. According to a 5 December Financial Times report, Telecom Plus is in talks to buy the retail energy business of Ovo Energy. This is one of Britain’s largest suppliers with around 4.5m customers.

Neither side has commented, but the deal could be worth more than £400m — a significant expansion for Telecom Plus. If completed, it could add millions of customers to the firm’s UK energy customers via its subscription-based model.

This kind of operational scaling could significantly boost its already strong earnings profile. And it is ultimately earnings growth that drives any firm’s dividends higher over time.

How do recent results look?

The firm’s full-year results to March 2025, released on 24 June, showed revenue easing back nearly 10% year on year to £1.838bn. But profitability improved: adjusted pre-tax profit rose 8.1% to £126.3m, while earnings per share climbed 9.4% to 119.2p.

Shareholders were rewarded with a 13.3% dividend increase to 94p, underlining management’s confidence in the firm’s long-term trajectory.

The half-year update published on 25 November painted a more mixed picture. Revenue grew 6.7% to £744.5m, but adjusted pre-tax profit fell 29.5% to £32.5m.

That said, customer numbers surged 19% to 1.39m, highlighting that Utility Warehouse’s growth engine remains firmly in motion.

Even with the profit dip, the board nudged the interim dividend higher by 2.7% to 38p per share.

A key risk to the firm remains energy market volatility that can depress earnings even if customer growth is strong.

However, analysts forecast that Telecom Plus’s earnings will grow by 10.3% a year to end-2028.

How much passive income can it generate?

I already have shares in another telecoms firm (BT) and other energy sector ones (BP, Shell, Harbour Energy). Buying another would unsettle the risk/reward balance of my portfolio.

But for investors without this problem, I think the firm is well worth considering.

Analysts forecast that the current 6.7% dividend yield will rise to 7.4% this year, 8% next year, and 8.6% in 2027.

Of course, yields can go up, down, or stay the same over time.

That said, a £20,000 stake at the 8.6% yield would allow investors to target £27,118 in dividends after 10 years. This also factors in ‘dividend compounding’ being used.

On the same basis, the dividend returns would jump to £241,525 after 30 years. This could give a total value for the holding of £261,525 (with the initial £20,000 included).

And this would hopefully give an annual passive income of £22,491 by that time!

It is a pity that my current holdings preclude me from investing here. However, Telecom Plus goes on my list as a replacement if any of my present holdings start to underperform.

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