In a recent article I shone a light on two exceptionally-priced dividend stocks that eagle-eyed investors can get rich off of in the years ahead.
That’s great, you might well say. But if you’re one of those investors looking to max out what you can get for your hard-earned investment cash then the following stocks may be more to your liking: they offer scintillating growth prospects, too.
Eddie Stobart Logistics
Now Eddie Stobart hasn’t got a storied history of earnings or dividend growth. But it can be hardly blamed for this, the logistics specialist in its current incarnation only coming into existence after being spun off by FTSE 250-listed Stobart Group in the past few years and subsequently admitted to the Alternative Investment Market (or AIM) in early 2017.
But in the time that it’s been trading Eddie Stobart has made quite the splash. In the 12 months to last November 2017 adjusted pre-tax profits boomed 58% to £37.8 million, a result that prompted it to pay a juicy maiden dividend of 5.8p per share.
And since then results have been impressive. Its latest trading update in August revealed a 25% revenues improvement to £359.3 million, which in turn drove adjusted profit before tax to £14.1 million, up by around a third year-on-year. And the cheery result prompted it to hike the interim dividend 10% to 1.54p. Eddie Stobart continues to rack up juicy contracts with major fast moving consumer goods (or FMCG) operators, the company adding Britvic and Pepsi to its client list in recent months. And an emphasis on the e-commerce sector – one which delivered revenues growth of 118% in the six months to May — also bodes well for the future.
City brokers share my positive viewpoint and are forecasting earnings growth of 20% and 15% in fiscal 2018 and 2019 respectively, estimates which underpin expectations of not-insignificant dividend rises too. A 6.4p total reward is predicted for this year and 7p for next year, figures that yield an eye-popping 5.6% and 6.2% respectively.
At current share prices Eddie Stobart sports a forward P/E ratio of 9.6 times. Value chasers thus need to give the business some serious attention.
Maintel Holdings
Unlike the logistics leviathan, Maintel Holdings hasn’t been delivering blockbuster profits growth as yet, reflecting legacy contract issues which have smacked margins in the past year.
Up until that point the communications services specialist had been a regular deliver of double-digit-percentage annual earnings increases. Despite the recent hiccup, in my opinion the long-term outlook for Maintel remains compelling and this reflects its decision to become first and foremost cloud and managed services business.
Trading remains encouraging, the AIM firm advising in September that new orders were up 25% year-on-year for the six months to June, and adding that the “recovery [is] set to continue, with a strong order book and pipeline, going into the second half.” Thus it’s no shock that the number crunchers are expecting Maintel to punch back with earnings rises of 14% in 2018 and 21% in 2019.
There’s much for dividend chasers to celebrate, too, with predicted dividends of 34.5p and 37p per share for 2018 and 2019, meaning that investors can enjoy bumper yields of 5.1% and 5.5% for these respective yields.
As of today Maintel boasts a prospective P/E multiple of just 8.8 times. I believe that it’s currently a bona-fide bargain that could make you handsome returns in the years ahead.
