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16 June 2021
10:31 hour

3 high-yielding FTSE 250 shares

The Motley Fool UK

10/06/2021 - 08:12

FTSE 250 shares are often less well known than the companies in the FTSE 100, yet the index contains many companies with high dividend yields. The post 3 high-yielding FTSE 250 shares appeared first on The Motley Fool UK.


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  1. Why I’d pick the FTSE 100’s 2 highest yielding shares (31/03/2021 - The Motley Fool UK)
    Looking at the top end of the FTSE 100 dividend league today there are some juicy looking yields. But the highest yielding shares often divide opinion as to their future prospects. Here I look at a bull and bear case for the two highest yielding shares in the FTSE 100 right now. M&G: a bull case Investment manager M&G (LSE:MNG) offers a yield of 8.8%. This month, the company announced a dividend increase. The increase was fairly small, at 2.6%. But it was seen as a sign of confidence from the company. That is in line with its stated target of a stable or increasing dividend. Basic earnings per share of 44p grew from last year. The dividend is covered more than twice by earnings. Trading at a price-to-earnings ratio beneath 5, the share looks undervalued to me. There is continued space for demand growth in the investment management space. M&G’s well-known brand can help it to attract customers and benefit from future growth. A bear case for M&G A high yield is often a signal that the market expects possible bad news in future, such as a dividend cut or reduced earnings. One of the difficulties in valuing M&G is that it has a short history as an independently listed company. It was only spun out from Prudential in 2019. That means some investors may be wary of the company until it has a longer financial record as an independently traded share. The market for investment management can be affected by factors such as a fall in savings rates, economic downturn or new regulations. While the pandemic has boosted savings rates, they could fall once the broader economy reopens. FTSE 100’s highest yielding shares Right now, the highest yielding shares in the FTSE 100 are those of Imperial Brands (LSE:IMB). The most recent dividend payout was today, reminding existing shareholders like myself of the attractive yield. Offering a yield of 9.2%, Imperial puts even M&G’s payout slightly in the shade. While cigarette consumption is declining in key markets, Imperial has set out plans to move into other tobacco formats where it sees growth opportunities. Meanwhile, it is working to shore up its cigarette market share in its key markets. In a trading statement yesterday, the company said that it was now seeing such market share growth across these five markets in aggregate. It reassured the market that trading is in line with expectations. Like M&G, Imperial has a single-digit P/E ratio, less than six. An Imperial bear case Although the yield is strong, last year the company cut its dividend after many years of increases. That makes the dividend more affordable for the company. But it is a harsh reminder that no dividend is ever guaranteed. Smoking is declining in many markets yet remains central to Imperial’s business. Selling its premium cigar business helped the balance sheet – but will make it harder to maintain earnings. The dividend is covered by earnings, but less than in M&G’s case. What I’ll do now about the highest yielding shares On balance, I see easier growth prospects for M&G than for Imperial in coming years. That could make dividend maintenance easier. I already own Imperial. My next action is considering opening a position in M&G. That would give me exposure to both of the FTSE 100’s two highest yielding shares. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading The Imperial Brands share price: I’d buy the stock for its 9% yield The Royal Mail share price continues to rise. Here’s why I’m steering clear My plan to earn passive income for a pound a day Three 6%+ yielding FTSE 100 UK shares I’d pick today 3 cheap UK shares to buy for high dividend yields christopherruane owns shares of Imperial Brands. The Motley Fool UK has recommended Imperial Brands and 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. The post Why I’d pick the FTSE 100’s 2 highest yielding shares appeared first on The Motley Fool UK.
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  2. Revs etf with 20+% dividend yield?!? (19/04/2021 - Reddit Stocks)
    How is this stock yielding that much? When I look at the underlying assets it's low yielding large value companies like Johnson & Johnson. I have looked at a few different sources and they all show the same high yield, but something doesn't make sense.   submitted by   /u/lymph31 [link]   [comments]
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  3. How I’d invest £1,000 in FTSE 100 shares now to try to double my money (23/03/2021 - The Motley Fool UK)
    As a child, a popular distraction for me was trying to fold a piece of paper over more than seven times. Each move doubled the thickness of the paper. Within a few moves, it was hard to do as the wad had grown so thick. If I could invest in some FTSE 100 shares that doubled my money in this way, even a fairly modest sum like £1,000 could grow into a much more substantial amount over time. Here’s how I would invest £1,000 right now to aim to double my money. Income reinvestment with FTSE 100 shares One approach to doubling my money would be choose a high yielding share and bank the dividends. I explained how such an approach might work in an article focused on tobacco producer Imperial Brands. But there are other high-yielding shares that I think could help me double my money if I’m patient. For example, FTSE 100 share M&G is currently yielding 9%. That means in the first year of holding the financial services company, I would expect £90 of dividends from my £1k investment. At that rate, I would be on track to double my money from the dividends after 11 or 12 years. If I reinvested the dividends as I went, so that they also earned a high yield, I might get there sooner. However, this might not work out. For example, M&G may decide to lower its dividend rate, or it could cut its altogether. Twelve years is a long time in which the financial services market could be affected by all manner of changes, from fintechs eating into profitability to another financial crisis. To double my money, I’d also need my original stake to maintain its value. Over time, the share price could grow, but if it fell back, I might not double my money overall even with 12 years’ worth of dividends. Growth shares Instead of focusing on income I could seek to double my money by investing in shares I think are underpriced relative to their future growth prospects. Doubling might sound unlikely, but share price movement means it can happen to a wide range of shares over time. In January I identified five UK shares I thought could double this year. One of them, Card Factory, went up 75% in the next several months. Over the past year, it has done even better, more than doubling. But one reason Card Factory has moved a lot is because analysts are so split on its prospects. With high street retail in decline, the future for a chain of card shops could be challenging. If I only had £1,000 to invest, I think I would prefer a company whose future prospects seemed more promising. That is why, instead of smaller companies like Card Factory, I would be more attracted by FTSE 100 shares. Blue-chip growth and income I would be tempted to search for growth and income as a way to double my money. Imperial could yet cut its dividend as smoking declines, for example. But meanwhile I’d bank any future dividends. If tobacco stocks come back into fashion, the share price could rise. The FTSE 100 shares are already up 17% over the past year. By putting £1,000 in now with a 9% yield, I’d hope to double my money in 11 years or so. But if the share price keeps growing, it could be sooner.   “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading This is what I’m doing about the Tullow Oil share price right now! Who is eligible for the stamp duty holiday (and who isn’t)? I’d buy this ‘reopening’ stock on today’s news FTSE 100: these were the best shares to buy in the market crash a year ago! Passive income investing: my 4 steps to go from £0 to £500 a month christopherruane owns shares of Imperial Brands. The Motley Fool UK has recommended Card Factory 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. The post How I’d invest £1,000 in FTSE 100 shares now to try to double my money appeared first on The Motley Fool UK.
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  4. I think these 2 dividend stocks could be among the best UK shares to buy today (09/02/2021 - The Motley Fool UK)
    Dividend stocks could be a means of obtaining a passive income in 2021. However, they may offer more than just a generous income return. Income shares could become more popular in an era where low interest rates may remain in place for a prolonged period of time. Furthermore, today’s high-yielding shares could offer good value for money, as well as dividend growth potential over the coming years. With that in mind, here are two FTSE 100 dividend shares that could be worth buying at the present time. An improving outlook relative to other dividend stocks SSE could become increasingly attractive relative to other dividend stocks in the next few years. The renewables-focused utility company recently updated the market on its performance. It remains on track to meet its guidance to deliver dividend growth that’s at or above inflation over the next few years. This could make the stock more appealing over the medium term because of the potential for inflation to move higher. A loose monetary policy may mean the price level increases at a faster pace in future than it has done in the past. Alongside the company’s 5.4% yield, this could make it an attractive FTSE 100 share to buy at the present time. A high-yielding UK share at a relatively low price While many UK shares have risen sharply in the recent stock market rally, GlaxoSmithKline (GSK) isn’t among them. Its shares have continued to fall over recent months so that it’s now among the highest-yielding dividend stocks in the FTSE 100. Its 6% dividend yield could make it attractive from an income perspective, since many FTSE 100 shares have considerably lower yields at the present time. Certainly, its dividends have failed to rise in recent years on a per share basis. They could even come under pressure over the coming years as the company embarks on major structural and organisational changes. However, those changes could catalyse its financial performance over the long run, and may be priced in to the company’s valuation via a relatively high yield. Potential risks from buying income stocks Of course, dividend stocks don’t guarantee investors will receive any passive income. They could, for example, experience challenging operating conditions that restrict their ability to pay out profit to investors. Similarly, they may decide to retain capital in what remains a tough economic outlook. This could have a detrimental impact on their income prospects. However, with other assets potentially offering low returns in a low interest rate environment, dividend shares such as GSK and SSE could be attractive as part of a diverse portfolio of stocks. When combined with other companies, they may offer an attractive passive income that grows over the coming years. This could increase their appeal on a relative basis and allow them to command higher share prices that translate into impressive total returns for investors. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading The BHP share price is fluctuating! Is this FTSE 100 mining stock worth buying? 2 UK stocks from my ‘best shares to buy now’ list 2 FTSE 100 shares I’d buy today for passive income Stock investing: 2 of the best UK shares I’d buy now and aim to hold until 2030 Omega Diagnostics: Is it a buy after its almost 35% rise today? Peter Stephens owns shares of GlaxoSmithKline and SSE. The Motley Fool UK has recommended GlaxoSmithKline. 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 post I think these 2 dividend stocks could be among the best UK shares to buy today appeared first on The Motley Fool UK.
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  5. FTSE 100 dividends: should I buy this big-cap stock yielding more than 5%? (16/02/2021 - The Motley Fool UK)
    What factors lead to a good dividend investment? I like to see a high-yielding stock backed by a steady, cash-generating business. And some of the best dividend investments often have a multi-year record of rising revenue, earnings, operating cash flow and shareholder dividend payments. On top of that, I reckon a decent level of yield is desirable right away. So, companies yielding between 3% and 7% can be interesting and worthy of further research. FTSE 100 dividends from BHP For example, FTSE 100 mining company BHP (LSE: BHP) has a forward-looking dividend yield of just above 5% for the trading year to June 2022. And today’s half-year results report contains some impressive figures. Compared to last year’s half-time performance, underlying earnings per share rose 16%. And the net operating cash flow increased 26%. The directors increased the interim dividend by 55%. Right now, things are going well for BHP. Looking ahead, the company reckons the outlook for global economic growth and commodity demand “remains positive.” The directors mentioned in the report that policymakers “in key economies” have been committing to growth. And there’s a desire to tackle climate change. BHP reckons those factors will likely drive growth in demand for energy, metals and fertilisers. And factors such as population growth and rising living standards will help demand as well. BHP deals in commodities such as copper, iron ore, coal, nickel, and oil. And the market prices have been robust for most of them lately. If BHP’s outlook assessment proves to be correct, commodity prices could remain strong for some considerable time. And that could lead to high earnings for the company. However, BHP runs a cyclical business. And bigger earnings may not always translate into progress for the share price. For example, I’m mindful of the recent performance of the London-listed bank stocks. The rollercoaster of cyclicality The banking sector is cyclical too. And leading up to the Covid crash, bank shares spend around a decade moving sideways, even as their annual earnings continued to rise. Instead of bank share prices rising to account for higher earnings, their valuations gradually contracted instead. And those bank stocks found it hard to make upwards progress. I reckon through that ‘wilderness’ period for bank shares, the stock market was waiting for the next cyclical down-leg. So investors didn’t allow the shares to rise too much. And the method of achieving that was valuation compression. And it makes sense. The pandemic caused a dramatic crash, but cyclical businesses always cycle down again in the end. And that’s why I’m cautious about the big mining companies. BHP is enjoying a period of fat profits now. But profits, cash flows, shareholder dividends and the share price have a history of volatility with big swings up and down. And near 2,270p, the stock is near the top of a 10-year trading range. BHP doesn’t meet my criteria for a decent, long-term dividend-led investment. Rather than leading my analysis by considering the dividend yield, I prefer to consider the firm’s cyclicality first. Of course, the stock may shoot up from here and deliver shareholders with decent dividends for years to come. But I’m watching from the sidelines for the time being. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading Top income stocks for February 2021 Stock investing: 3 of the best income shares I’d buy right now The BHP share price is fluctuating! Is this FTSE 100 mining stock worth buying? My best shares to buy list: 3 to consider I’d buy these FTSE 100 UK shares yielding 6%! Kevin Godbold has no position in any 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. The post FTSE 100 dividends: should I buy this big-cap stock yielding more than 5%? appeared first on The Motley Fool UK.
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  6. The top FTSE 100 dividend shares to buy now (15/06/2021 - The Motley Fool UK)
    I’ve been looking for some stocks with attractive yield for my portfolio. Here are three FTSE 100 dividend shares with some of the highest yields in the index right now. I’ll explain my next move for each. Tobacco shares Tobacco companies often have high yields. Why is that? First, making and selling products like cigarettes can be highly cash generative. They are cheap to produce but can sell at an attractive profit margin. As a mature industry, tobacco has limited options to reinvest profits. That means tobacco companies can use chunky cash flows to fund dividends. Additionally, there is concern about the sustainability of the business model as cigarettes fall in popularity in many markets. That is a risk – and it helps explain the above average yield. Some investors fear the yields are ultimately unsustainable if smoking declines. Two of the highest yielding FTSE 100 dividend shares are Imperial Brands and British American Tobacco. If choosing only one today I’d be tempted to invest in BAT for its scale, global reach, and history of raising dividends annually for over two decades. Past dividend payments aren’t a guide to future ones, though. FTSE 100 dividend shares in the mining sector A number of the highest yielding FTSE 100 dividend shares are miners. These include names like Rio Tinto, BHP, and Evraz. For example, Rio Tinto currently yields over 5%. With its collection of quality mining assets, I think that there is a lot to like about the company. But with dividends as the objective, I would be wary of investing in mining companies for my portfolio. That’s because of the cyclical nature and high capital expenditure requirements of the mining industry. That leads to uneven dividend records in many cases. With demand for metals expected to remain high as economies reopen, I think the outlook for companies like Rio are strong. But there is a risk that when demand falls back in future, commodity prices will slip and dividends will be cut. So, I won’t be buying Rio at this time. Financial services pick Another name on the list of highest yielding FTSE 100 dividend shares is M&G (MNG). The investment management company currently yields 7.4%. While its dividend history as an independent listed company is limited, it raised its dividend this year. I took that as a sign of confidence from management. M&G has over 5m retail customers and 800 institutional clients. So it benefits from wide recognition and a substantial customer base. I see that as positive for the investment case. I expect many customers will likely stick with the provider rather than take time to research alternatives. That should be good for revenue and profits. One risk with a financial services firm like M&G is the impact of any broader economic downturn. That could lead to customers investing less, which could hurt profits. My next steps on FTSE 100 dividend shares I’d willingly buy more British American Tobacco shares for my portfolio today. I also continue to keep M&G on my watchlist and would consider buying it. I won’t be investing in Rio Tinto or any mining shares, as I believe there are more attractive options among other leading FTSE 100 dividend shares. The post The top FTSE 100 dividend shares to buy now appeared first on The Motley Fool UK. 5 Stocks For Trying To Build Wealth After 50 Markets around the world are reeling from the coronavirus pandemic… And with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains. But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be daunting prospect during such unprecedented times. Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down… You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm. That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away. Click here to claim your free copy of this special investing report now! More reading Deliveroo share price: here’s my view 3 months after the IPO Stock market crash: these 2 warning signs make me anxious Top British stocks to buy for the infrastructure boom Kin and Carta share price soars 300%! Should I buy this UK share today? Lockdown easing delayed: what restrictions remain christopherruane owns shares of British American Tobacco and Imperial Brands. The Motley Fool UK has recommended 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.
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  7. New Schwab ETF -SCHY- Swhwab International Dividend Growth Index (29/04/2021 - Reddit Stocks)
    New international etf from Schwab drops today. Expense Ratio of 0.14. Looks like a strong alternative to VXUS https://www.schwabassetmanagement.com/products/schy https://www.schwabassetmanagement.com/resource/schy-fact-sheet “ The fund’s goal is to track as closely as possible, before fees and expenses, the total return of an index composed of high dividend yielding stocks issued by companies outside the United States. Invests in non-U.S. high dividend yielding stocks with a record of paying dividends for at least 10 consecutive years, financial strength and screened for lower volatility”   submitted by   /u/Subdued_Stallion [link]   [comments]
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  8. Three 6%+ yielding FTSE 100 UK shares I’d pick today (25/03/2021 - The Motley Fool UK)
    Hunting for yield can get harder when stock markets start to rise. But right now, a number of UK shares offer yields in the mid to high single digits I find attractive. Not only that, these include some FTSE 100 constituents. Here are three such 6%-plus yielders from the FTSE 100 I’d consider buying today. UK shares increase dividend Shares in financial services provider M&G (LSE: MNG) have increased 37% over the past year. Yet M&G still offers an 8.9% yield. Previously part of Prudential, M&G only has a short track record as an independent listed company.  I think that means some investors may be struggling to value it and also wondering how sustainable the yield is. Last year’s 18.23p dividend was covered more than twice over from earnings. The prior year’s earning coverage was even stronger. I also took it as a good sign that management announced this month that the final dividend for last year would be increased. The increase was small – around 2% – but it still suggests that the board has confidence in the company’s prospects. Financial services results can be hit by the economic cycle, so future results may not be as good. More than cigarettes Tobacco companies tend to be highly cash generative. That makes them favourites for many dividend hunters, though some investors shun them on ethical grounds. One of the key attractions to me in British American Tobacco (LSE: BATS) is its portfolio of iconic cigarette brands such as Lucky Strike and Rothmans. Cigarettes can be highly profitable because they aren’t very expensive to make but smokers are often willing to pay a premium for them. However, with tobacco use declining in many markets, the cash generation machine of cigarettes may decline in years to come. Interestingly, BAT has been expanding into new business areas in recent years. It added 3m consumers to its non-combustible products last year and says it is on track for 50m by 2030. That strategy could help compensate for future losses of cigarette smokers. But high development costs and lower profit margins could make them less attractive than today’s business. I also don’t like the company’s £39bn of adjusted net debt. So I was happy to see it fall by 5% last year. Meanwhile, last year profit from operations grew in double digits. BAT raised its dividend again last month. The UK shares now yield 7.6%. Boring but profitable As cigarettes show, attractive income streams often don’t need a new idea. Take insurance as an example. It’s an old industry. The basic principles have hardly changed. That enables companies to apply them effectively. Legal and General (LSE: LNG) was set up in 1836. Its deep expertise in insurance and strong brand name help give it an advantage in the UK market. But Legal & General is not just an insurer. Under its colourful umbrella sits a sizeable financial services business. It provides services such as pensions and capital investment. These could help grow the business when insurance enters one of its cyclical downturns, though they do add financial complexity. Its established position has helped its UK shares pay out a dividend each year since before the turn of the century. It continued to pay during the pandemic and financial crisis. That sort of consistency appeals to me, although it is not guaranteed in the future. Currently the shares yield 6.4%. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading 2 FTSE 100 shares with 8% yields I’d buy for an ISA today 2 of the best UK high-dividend shares to buy today 9% dividend yields! Should I buy this FTSE 100 share before the ISA deadline? 3 FTSE 100 stocks to buy with £3k FTSE 100 shares: this could be the best dividend stock to buy now christopherruane owns shares of British American Tobacco. 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. The post Three 6%+ yielding FTSE 100 UK shares I’d pick today appeared first on The Motley Fool UK.
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  9. London Markets: FTSE 100 headed for best weekly return since January (09/04/2021 - Market Watch)
    The FTSE 100 has outperformed its European rivals this week, thanks to the pound. Among stocks, Babcock International shares slid, while PageGroup surged on.
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  10. National Grid shares are my top FTSE 100 dividend buy right now (20/05/2021 - The Motley Fool UK)
    Which is the best FTSE 100 stock for dividends? Banks have been popular. But we had a financial crisis that wiped out dividends, and then the Covid-19 pandemic did it again. Energy producers have a dividend tradition too. But with green pressure increasingly bearing on them, even BP has done the unthinkable and rebased its dividends. But National Grid shares have just carried on yielding the cash. Full-year results were out Thursday, and there’s been no change to the trend. The dividend for the 2020-21 year was only lifted 1.2%. But the 49.16p per share represents a yield of 5.2% on the current share price. The figures were respectable, if not exciting. Statutory results showed increases across the board, but we saw small falls in underlying figures. Operating profit dropped 3%, with earnings per share down 7%. Capital investment dropped a little too, by 7%, but still exceeded £5bn. Decent results in tough times For the year we’ve just had, I’m happy with these results. Chief executive John Pettigrew said that National Grid’s performance during such a tough time is “testament to the strength and resilience of our business model.” The company reiterated its policy of providing long-term asset and dividend growth. The main reason I’ve always liked National Grid shares is that it never matters which oil company provides the oil or gas, or which energy retailer sells it to the end customer. It has to go through the distribution networks. Energy restructuring National Grid does run the gas distribution network, and that’s still carrying fossil fuel. On that front, the company intends to sell off a majority stake in its gas transmission division. The latest updates confirm that should be completed during the 2022-23 year. The acquisition of Western Power Distribution shows that the company is serious about a refocus on electricity distribution. But it does mean we’re looking at a slimmer organisation, and increased capital expenditure as the firm makes the transition. Might that put pressure on those precious dividends? The uncertainty shows in the performance of National Grid shares. They’re doing fine in 2021, slightly behind the FTSE 100. But over five years, they have declined 12.5%. Still, even at its lowest point in the past 12 months, the share price was still healthily above its weaker 2018 levels. So there looks to me some support among investors now. National Grid shares valuation Based on the latest underlying EPS figure, National Grid shares are on a P/E of approximately 17. That could look a bit high considering the energy sector risks. But it could be seen as low for a reliable dividend stock yielding better than 5%. So where’s the dividend likely to go? We have some guidance for the five-year period of 2020-21 to 2025-26. National Grid expects to see a compound annual growth rate (CAGR) in assets of 6%-8%. It reckons that should feed through to an earnings per share CAGR of 5%-7%. I think that’s probably enough to keep the dividend safe. National Grid is on my buy list for 2021. The Motley Fool UK's Top Income Stock… We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign. But with this opportunity it could get even better. Still only 55 years old, he sees the chance for a new “Uber-style” technology. And this is not a tiny tech startup full of empty promises. This extraordinary company is already one of the largest in its industry. Last year, revenues hit a whopping £1.132 billion. The board recently announced a 10% dividend hike. And it has been a superb Motley Fool income pick for 9 years running! But even so, we believe there could still be huge upside ahead. Clearly, this company’s founder and CEO agrees. Learn how you can grab this ‘Top Income Stock’ Report now More reading I like these FTSE 100 shares with 5%+ yields for passive income 3 UK income shares I’d buy Why I’d buy National Grid shares for my ISA Alan Oscroft 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 post National Grid shares are my top FTSE 100 dividend buy right now appeared first on The Motley Fool UK.
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  11. FTSE 100 shares I’d buy for large and growing dividends (23/05/2021 - The Motley Fool UK)
    FTSE 100 shares are arguably still undervalued. It’s often argued UK companies remain cheap when compared to other regions of the world. A spate of recent purchases of UK-listed companies gives some credibility to this argument. A combination of value, as well as income from dividends as they recover and grow post pandemic, have brought these two FTSE 100 shares onto my radar. Cheap FTSE 100 miner Rio Tinto (LSE: RIO) is one of the world’s leading mining companies. It certainly won’t be everyone’s cup of tea on ESG grounds, but if I look past that, it’s a FTSE 100 share that strikes me as being good for income. The dividend payout has been particularly strong in recent years, with consecutive special dividends pushing up the yield. The current dividend yield is 5.2%, far above the average for the FTSE 100. Projections are the dividend could end up being more like 10%.  A weaker than expected start to 2021 is a risk I’ll keep an eye on. I think expectations for miners are high as economies reopen following the pandemic. Underperformance will likely hit the share price. Another risk is around the reputational damage caused by blowing up sacred caves in Australia. The incident has had political recriminations and led to executive replacements and a pay revolt from shareholders. Rio Tinto is certainly not a buy and forget share. The mining industry is too cyclical for that. However, for the next few years it could be a sector that produces strong and growing dividends. More evidence of a commodities supercycle, where commodities do well for an extended period of time, might encourage me to buy the shares. Steady, defensive company The insurance company Admiral (LSE: ADM) is a more defensive high-yielding FTSE 100 share. In that way, it would potentially complement the more adventurous Rio Tinto in my portfolio. Admiral has a dividend yield of 4%, slightly above the FTSE 100 average, but more importantly than that it raised its dividend by just under 44% between 2019 and 2020. That’s an impressive rate of growth for a FTSE 100-listed company. It is a strong sign of confidence from management. The insurer has a business model that provides it with income no matter what the economic backdrop is. That’s why I believe it will be able to keep paying a large, but also growing, dividend. Since lockdown, it has performed particularly well financially. The share price has also done well over at the same time. In the year to 31 December 2020, pre-tax profit from continuing operations pushed up 20% to £608.2m. The insurer also gained more customers. With earnings per share also growing year-on-year, I’m confident that Admiral is a well run company with a profitable future. Both Rio Tinto and Admiral are FTSE 100 shares that I think could perform well over the coming years. I also happen to think in my portfolio the cyclical miner and the defensive insurer could make a complementary pairing. The Motley Fool UK's Top Income Stock… We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign. But with this opportunity it could get even better. Still only 55 years old, he sees the chance for a new “Uber-style” technology. And this is not a tiny tech startup full of empty promises. This extraordinary company is already one of the largest in its industry. Last year, revenues hit a whopping £1.132 billion. The board recently announced a 10% dividend hike. And it has been a superb Motley Fool income pick for 9 years running! But even so, we believe there could still be huge upside ahead. Clearly, this company’s founder and CEO agrees. Learn how you can grab this ‘Top Income Stock’ Report now More reading Will the Admiral share price reach £35? The FTSE 100 is falling: three 7% dividend yield shares I’d buy now Why I’d invest £5k in these FTSE 100 stocks right now! These two FTSE 100 stocks could pay £28bn in dividends for 2021! 2 FTSE 100 stocks I’d buy in May Andy Ross owns no share mentioned. The Motley Fool UK has recommended Admiral Group. 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 post FTSE 100 shares I’d buy for large and growing dividends appeared first on The Motley Fool UK.
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  12. 3 UK dividend stocks yielding 6%+ to buy now (12/06/2021 - The Motley Fool UK)
    Last week, I wrote about a FTSE 100 dividend share with an 8% yield that I’d buy now. In this piece, I want to look at three more high-yielding UK dividend stocks. All three companies are expected to deliver a cash return of at least 6% this year. They’re all stocks I’d be happy to buy as long-term holdings for my income portfolio. A 6.5% income from gold? Shares in FTSE 100 gold miner Polymetal International (LSE: POLY) have risen by nearly 15% since I last covered the stock in March. My view hasn’t changed though. I continue to hold the stock and see this Russia-based group as a good way to benefit from the strong market for gold. Polymetal benefits from all-inclusive mining costs of less than $1,000 per gold ounce. With gold trading at nearly $1,900 per ounce, as I write, it’s easy to see why the company’s generating plenty of cash at the moment. Management is targeting modest production growth over the next 18 months, but the main attraction for me is the stock’s forecast yield of 6.5%. In my view, this looks comfortably affordable at the moment. The main risk is that a gold price slump could cause future payouts to fall. However, I’m comfortable with this risk, given Polymetal’s low costs and good scale. This dividend stock is still a buy for me. An unloved 8.6% yield Tobacco group Imperial Brands (LSE: IMB) is one of the cheapest stocks in the FTSE 100. The company’s shares trade on just 6.5 times 2021 forecast earnings and offer a dividend yield of 8.6%. The risks are obvious enough. Tobacco is dangerous and highly regulated. Smoking rates in European markets — where Imperial sells most — are falling. I think there’s a risk that, at some point, selling cigarettes could become unviable in some countries. However, I don’t expect this to happen for many years, if at all. Right now, Imperial’s performance is improving under its new chief executive. The company’s high-profit margins and strong cash generation are supporting an attractive dividend. As a shareholder, I think the Imperial’s valuation already reflects the likely risks facing the business. I’d be happy to buy more at current levels. A below-the-radar dividend stock My final choice is a FTSE 100 share, but it isn’t a household name. Phoenix Group (LSE: PHNX) is a life insurer that buys ‘closed books’ of insurance policies from other insurers and then runs them to maturity. Phoenix is now the biggest player in this market in the UK. I’ve followed this business for several years and it’s been a reliable performer. In my experience, management forecasts are generally accurate and cash generation is strong, funding a 6.5% dividend yield. The business came through last year’s market crash without much difficulty. The main risk I can see is that Phoenix might struggle to keep growing. To address this, the company has recently gained the right to use the Standard Life brand. This will help increase the company’s sales of new insurance policies. Insurance businesses have quite complex financials, but I’m comfortable with Phoenix’s track record. This is a dividend stock I’d be happy to buy and forget for a few years. The post 3 UK dividend stocks yielding 6%+ to buy now appeared first on The Motley Fool UK. The Motley Fool UK's Top Income Stock… We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign. But with this opportunity it could get even better. Still only 55 years old, he sees the chance for a new “Uber-style” technology. And this is not a tiny tech startup full of empty promises. This extraordinary company is already one of the largest in its industry. Last year, revenues hit a whopping £1.132 billion. The board recently announced a 10% dividend hike. And it has been a superb Motley Fool income pick for 9 years running! But even so, we believe there could still be huge upside ahead. Clearly, this company’s founder and CEO agrees. Learn how you can grab this ‘Top Income Stock’ Report now More reading 2 FTSE 100 dividend shares I’d buy and aim to hold for 10 years 2 top British dividend income stocks I’d buy today Top British stocks for June Does Imperial Brands share price weakness offer me a top dividend buy? 2 high-dividend-yield stocks to buy now Roland Head owns shares of Imperial Brands and Polymetal International. The Motley Fool UK has recommended 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.
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  13. Why I’m still adding FTSE 100 shares to my best stocks to buy now list (13/02/2021 - The Motley Fool UK)
    FTSE 100 shares could offer long-term capital growth potential from their current price levels. After all, the index continues to trade below its record high. This suggests many of its members could be undervalued at the present time. Furthermore, the outlook for the world economy is widely forecast to improve in future. This may create more attractive operating conditions that makes FTSE 100 companies among the best stocks to buy now. Clearly, they’ve risks ahead of them. But through diversification and obtaining a margin of safety it may be possible to reduce potential threats. FTSE 100 shares trading at low prices Many FTSE 100 shares continue to trade at prices that are significantly below their all-time highs. The lead index is currently around 10% down on its price level from a year ago. This suggests there may be opportunities to buy a range of companies while they offer wide margins of safety. Investor sentiment towards some industries is weaker than towards others. For example, consumer goods companies have higher valuations than banks, retailers or travel & leisure businesses in general. This is understandable, since less popular industries among investors may face more challenging operating environments. However, where FTSE 100 shares have the financial means to overcome future difficulties, they could offer recovery potential. In many cases, investors may have priced in the potential for weak financial performance in the coming months. Therefore, there may be scope for an expansion in valuations among today’s unloved industries. This could make large-cap shares among the best stocks to buy now. The potential for an economic recovery FTSE 100 shares may also be among the best shares to buy now because of their long-term growth prospects. Clearly, there’s never any guarantee that the world economy will post positive GDP growth. It continues to face major risks, such as coronavirus, that could hold back its performance for some time. However, the scale of stimulus packages being rolled out and the vaccines being administered could allow many industries to face less disruption in future. This may contribute to improved operating conditions that strengthen their financial performances. The result of this effect on company valuations from across the FTSE 100 could be relatively positive over the coming years. This may catalyse a period of stronger growth for many large-cap shares that’s not currently reflected in their valuations. Reducing risks through diversification Although FTSE 100 shares may have a size and scale advantage versus smaller peers, and may be more diversified than small-caps, they still carry significant risks. As such, it’s prudent to invest in a wide range of businesses instead of concentrating capital on a more limited number of companies. Doing so can reduce overall risks. And that can lead to higher returns in the long run. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading The Carnival share price plunges 60%! Should I buy the stock? Should I buy this 6%+ yielding oil stock instead of BP or Shell? Desperate to save? Try a no-spend challenge Reasons I’m investing in FTSE 100 shares right now Why I’d buy dividend shares with more than just high yields in this stock market recovery 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 post Why I’m still adding FTSE 100 shares to my best stocks to buy now list appeared first on The Motley Fool UK.
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  14. FTSE 100 shares: this could be the best dividend stock to buy now (10/03/2021 - The Motley Fool UK)
    My main investing focus is on income. As I’m looking for high-yield stocks for my Stocks and Shares ISA, I tend to focus on the larger companies in the UK market. My research suggests the 6%-yielding FTSE 100 share I’m looking at today could be the best dividend stock to buy right now. The company in question is savings and investment firm Legal & General Group (LSE: LGEN), which has released its latest figures today. Of course, this financial giant won’t be suitable for everyone and I wouldn’t abandon my diversified portfolio for a single stock. But if I were buying dividend shares for a new portfolio today, Legal & General would definitely be on my list. Good results in a bad year I expected last year’s stock market crash to hit Legal & General’s 2020 profits. But today’s results show the impact was fairly minimal. Although pre-tax profit fell 12% to £1,607m, this drop was mostly related to valuation changes on some of the group’s assets, not cash income. Cash released from the group’s operations — a key measure for dividend support — was more stable and fell by just 3.6%, to £1,539m. This supported an unchanged dividend of 17.6p per share. That means this FTSE 100 share offers a dividend yield of 6.2% at current levels. Legal & General’s strong cash generation is possible because this business is very profitable. The group’s return on equity was 17.3% last year, down from 20.4% in 2019. I think that’s a good outcome in such a difficult year. What makes Legal & General special? A decade of low interest rates has made life difficult for banks and savers wanting safe returns on their cash. A 17% return on equity would be a dream come true for the UK’s big banks. So why is this FTSE 100 share doing so much better? I think the answer lies in Legal & General’s large pension business. This provides large amounts of capital that must generate reliable returns over long periods. Low interest rates make this difficult using traditional pension fund assets, such as government bonds. However, chief executive Nigel Wilson has used the stable funding provided by pension funds to diversify Legal & General’s investments into ‘real’ assets. These include housing, commercial property and renewable energy. The company calls this ‘Our City’. These assets require large amounts of capital up front but tend to generate reliable returns over long periods. Legal & General’s large size means it can invest in this way, while staying diversified. This FTSE 100 share looks great: what could go wrong? I believe Legal & General’s size is one of the secrets of its success. But it could also be the biggest risk for investors. The group has more than £1trn of assets under management. Many of these are complex and difficult to value. In reality, no one outside the business is every likely to have a full understanding of the quality and reliability of the company’s investments. Small valuation errors, or unexpected problems — like the pandemic — could trigger future losses. I can’t be sure anything like this will happen. But Legal & General has been in business for nearly 200 years and has been a pretty consistent performer over the last decade. With the stock trading on 10 times forecast earnings and yielding more than 6%, I’d be happy to buy this FTSE 100 share today. There’s a ‘double agent’ hiding in the FTSE… we recommend you buy it! Don’t miss our special stock presentation. It contains details of a UK-listed company our Motley Fool UK analysts are extremely enthusiastic about. They think it’s offering an incredible opportunity to grow your wealth over the long term – at its current price – regardless of what happens in the wider market. That’s why they’re referring to it as the FTSE’s ‘double agent’. Because they believe it’s working both with the market… And against it. To find out why we think you should add it to your portfolio today… Click here to get access to our presentation, and learn how to get the name of this 'double agent'! More reading Is the Legal & General share price good value? FTSE 100 stocks: 3 to watch out for in March 2 blue-chip UK shares I’d pick now for a growing income My ‘best stocks to buy’ list: I think these 2 UK shares could have passive income potential Roland Head 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 post FTSE 100 shares: this could be the best dividend stock to buy now appeared first on The Motley Fool UK.
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  15. Which are the highest dividend yield stocks to buy right now? (03/05/2021 - The Motley Fool UK)
    As an income investor, I’m concerned about trying to maximise the dividends I receive. The more bang for my buck that I can get, the harder my investment is working. Obviously, I want to ensure that the shares I buy have sustainable payments over time. But if I wanted to increase my risk tolerance and just focus on the highest-yielding stocks right now, what should I be looking at? A high yield, but some issues Within the FTSE 250, Hammerson (LSE:HMSO) technically (more on that below) has the highest dividend yield at just over 10%.  Hammerson is classified as a real estate investment trust (REIT). This means that it invests and holds property in order to gain this classification. Some of the sites include Brent Cross in London, Grand Central in Birmingham and Victoria Quarter in Leeds. As of the end of last year, the portfolio was valued at £6.4bn. REITs generally offer a high dividend yield. In order to be classified as a REIT, a company is required to distribute 90% of the income it generates to investors. Logically, dividend payments are often seen as the way to go. I do need to be careful when stating that Hammerson has the highest dividend yield right now. This is because the last round of dividends was actually pushed towards a scrip dividend alternative. Investors could still receive a cash dividend, but it was only 0.2p per share. The enhanced dividend alternative of 2p per share was from being given newly issued shares. This alternative still counts as a dividend, but in the form of shares not cash. In terms of the outlook for Hammerson, I’d be cautious. The share price is down heavily over the past year, largely due to Covid-19 closing sites and leading to a £1.7bn loss. Refinancing of debt and other issues are why I think the dividend alternative was suggested. The company, like many others, aimed to hold on to as much cash as it could. This goes against what I see as a sustainable dividend policy, so I would steer clear of the stock. A slightly lower-yielding dividend stock The second-highest dividend yield within the FTSE 250 is from Diversified Oil and Gas (LSE:DGOC). It does what the same suggests, and operates oil and gas wells in the United States.  Adjusted total revenue for 2020 came in 8% higher than the previous year, even with lower oil prices. Total cash expenses fell by 10%, allowing it to increase the dividend payout during the year. In fact, the dividend was raised in two consecutive quarters, meaning four payments were received by investors in total. In comparison to Hammerson, I think this high-dividend-yield stock is more sustainable. With the dividend yield at 9.88%, it’s still very high, but I would say offers lower risk than the REIT.  The risk from DGOC is the nature of the industry it operates in. Any company that owns and operates oil and natural gas wells is at the mercy of mother nature. The unpredictability of resources in both existing and future projects is something I always need to be thinking about as a long-term investor. Overall, Hammerson and DGOC are the two highest-yielding dividend stocks in the FTSE 250 right now. Personally, I’d prefer to buy DGOC over Hammerson for income. A Top Share with Enormous Growth Potential Savvy investors like you won’t want to miss out on this timely opportunity… Here’s your chance to discover exactly what has got our Motley Fool UK analyst all fired up about this ‘pure-play’ online business (yes, despite the pandemic!). Not only does this company enjoy a dominant market-leading position… But its capital-light, highly scalable business model has previously helped it deliver consistently high sales, astounding near-70% margins, and rising shareholder returns … in fact, in 2019 it returned a whopping £150m+ to shareholders in dividends and buybacks! And here’s the really exciting part… While COVID-19 may have thrown the company a curveball, management have acted swiftly to ensure this business is as well placed as it can be to ride out the current period of uncertainty… in fact, our analyst believes it should come roaring back to life, just as soon as normal economic activity resumes. That’s why we think now could be the perfect time for you to start building your own stake in this exceptional business – especially given the shares look to be trading on a fairly undemanding valuation for the year to March 2021. Click here to claim your copy of this special report now — and we’ll tell you the name of this Top Growth Share… free of charge! More reading 3 FTSE 250 stocks I’d buy in May Will the Hammerson share price recover in 2021? 2 penny stocks I’d buy right now jonathansmith1 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 post Which are the highest dividend yield stocks to buy right now? appeared first on The Motley Fool UK.
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  16. This FTSE 100 stock yields over 5%, making it a great passive income opportunity! (10/02/2021 - The Motley Fool UK)
    I look to FTSE 100 stocks for passive income opportunities to make my money work hard. Unfortunately, many firms have cut dividends since last year’s market crash. But there’s one stock, National Grid (LSE:NG), that I think is a great passive income opportunity for my portfolio. NG’s dividend yield is over 5%. FTSE 100 opportunity The average yield for a FTSE 100 company is 3%. Keep in mind that a higher yield isn’t always a good thing. A high dividend yield might indicate a business in distress. The yield could be high because the company’s shares have fallen in response to financial troubles, and the struggling company hasn’t cut its dividend yet. I class NG as a defensive stock. It possesses an enviable position at the heart of the UK’s energy ecosystem. NG owns the electricity transmission network in England and Wales. Further to this, it owns and operates the high-pressure gas transmission system in Great Britain too. NG’s current dividend policy aims to “increase dividend per share by at least RPI for the foreseeable future.” Not many FTSE 100 firms make such a bold and ambitious claim like this. I feel NG can achieve it, however. As I write this, NG’s yield is a juicy 5.7%. Analysts forecast this dividend yield based on 49.5p per share, which is an increase from the 48.57p paid out in March 2020. Of course, forecasts are not guaranteed and can change based on new developments. But NG’s policy of raising its dividend per share by the retail price index (RPI) makes me believe that its dividend yield could be 6%-plus later this year. If this happens, I would class it as one of the best FTSE 100 dividends, and it will certainly be a top passive income stock in my eyes. The NG share price is currently trading 16% lower than this time last year. Based on its defensive ability, the fact that it’s price has not reached or surpassed pre-crash levels is surprising. In fact, NG’s market crash low was 799p per share in March 2020. Nearly 11 months later and it has increased by less than 8%. This is where I feel an opportunity lies in picking up dirt cheap shares to help make a passive income. Risk but potential for passive income Utilities companies like NG aren’t completely without pitfalls and risks. NG is heavily regulated and there is always the threat of regulatory action. In addition to this, there is the threat of nationalisation in the background too. Furthermore, the power grid operator has to contend with huge capital expenditure bills. These can affect income, performance, and potentially even investment viability too. Nevertheless, I believe NG presents an excellent opportunity for me to make a passive income. It possesses solid defensive capabilities. At current levels I believe it is cheap too. Away from the FTSE 100, here is a FTSE AIM stock I really like right now too. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading 6% dividend yields! A UK share I’d buy in February and hold for 10 years High dividend stocks: why I’d buy these 3 FTSE 100 shares yielding up to 8% The National Grid share price is down: should I buy it for my Stocks and Shares ISA? Why this is one of my top shares for reliable passive income in 2021 and beyond Jabran Khan 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 post This FTSE 100 stock yields over 5%, making it a great passive income opportunity! appeared first on The Motley Fool UK.
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  17. iStar (STAR): Massively undervalued, Market Mispricing REIT (10/03/2021 - Reddit Stocks)
    iStar (STAR) is a REIT in transition moving assets to their ground leasing company called SAFE. There is a massive mispricing between the two intertwined companies. iStar's market cap is $1.3B yet owns $2.5B worth of SAFE and $3.1B worth of assets yielding 7.9%. As of Q4, there was only $50M of non-performing assets. This is trading at nearly an 80% discount! iStar’s SAFE investment ($2.5B): iStar created the ground leasing company SAFE in 2017, which is a REIT that owns ground leases, not buildings. There is already a lot written about SAFE, so I'm not going to summarize that; instead I'll focus on the mispricing. iStar owns 34.8M shares of SAFE currently valued at $2.5B ($73 / share)( Slide 11 ). Based solely on iStars SAFE holding, iStar should trade at $34.25 a share($2.5B of SAFE/ 74M iStar shares outstanding). Is SAFE legit? Goldman thinks so with a recently initiated $101 price target (Jan 2021), with a street average of $90 a share. If SAFE reached Goldman’s PT, this would translate to an iStar holding of $3.5B in SAFE. Based on Goldman’s SAFE Price target, iStar should trade at $47.10 a share, some 268% where it trades now. At this point, the mispricing is so stark that if you bought $73 of iStar (i.e. 1 share of SAFE), you would get 1.93 shares of SAFE*, plus iStar’s other underlying assets worth some $3B.* iStar’s Other Assets($3.1B): iStar breaks out their other lines of business into three buckets: Net Lease Consolidated Assets: $2.162B yielding 7.9% (Slide 12, Q4 report) Net Lease Venture II: 300M yielding 9% (Slide 13, Q4 report) Real Estate Finance Portfolio: $646M at 7.2% (Slide 15, Q4 report). In total, they have only $52M of non-performing assets. These assets total $3.1B yielding 7.9%. Upcoming catalysts: I strongly feel it's a matter of time before the market realizes this massive price discrepancy. Here are some possible events: Goldman initiated coverage on SAFE on January 27th, 2021. Why not cover iStar if they own 63% of SAFE? Three major assets of iStar are Asbury Park, Magnolia Green and Grand Vista. They are looking sell these off over the next 2 years. This would be a massive cash event that could trigger a large iStar share repurchase program. iStar has been trying to simplify its message by selling off legacy (though high quality) assets. iStar is nearly complete with this process and plans to begin messaging this year SAFE x STAR One-Stop Capital Program was launched in Q4. This combines deals that allow companies to ground lease through SAFE, then allow iStar to offer financing. This could offer some additonal topline growth and further prove their business model is scalable and synergistic between iStar and SAFE going forward. There is a lot of information already out on iStar and SAFE. I'm a big believer in the SAFE and iStar business models, though my intention here is to highlight the massive price discrepancy between the two stocks.   submitted by   /u/veggie-man [link]   [comments]
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  18. Why I’d shun this high-yielding FTSE 100 stock that ticks a lot of investors’ boxes (17/02/2021 - The Motley Fool UK)
    At first glance, FTSE 100 miner Rio Tinto (LSE: RIO) looks like an attractive stock. It’s got a high dividend yield, a low-looking valuation, escalating profits and modest levels of debt. And those attributes combine with positive director comments to make the share appear a potential winner. And it may prove to be. Why I’m cautious about Rio Tinto now However, I’m cautious about Rio Tinto right now. My first consideration when appraising a company in the mining sector is cyclicality. And I’m mindful of the advice written by Peter Lynch, who once excelled in managing the Fidelity Magellan Fund. He cautioned that cyclical stocks can be at their most dangerous for investors when they look at their most attractive. And that usually occurs after a long period of strong earnings. And I think Rio Tinto is in that zone now. Earnings have been riding high since dipping into negative territory during 2015. In today’s full-year report, the company posted underlying earnings per share 21% higher than the prior year. And net debt fell from $3,651m to $664m. The FTSE 100 business has been trading well. And the directors increased the ordinary shareholder dividend by 21% with a special dividend on top of that. Chief executive Jakob Stausholm said in the report the year had been “extraordinary”. He reckons “strong commodity prices” helped drive the good performance of the business. But if commodity prices fall in the future, so might the company’s profits and cash flows. And if that happens, the share price and shareholder dividend payments will likely decline as well. Meanwhile, the stock is currently trading above the top of its previous multi-year range. Of course, share price levels mean little in themselves and good investing is all about analysing the fundamentals and valuations of underlying businesses. But the highs on the Rio Tinto chart have almost always been fleeting and followed by precipitous plunges. Valuation compression is a ‘thing’ After all, this business is cyclical. And its nature means revenues, cashflows, earnings, shareholder dividends and the share price will likely fluctuate. Meanwhile, City analysts predict an advance in earnings in 2021 of around 30%. If this was a growing business in a less cyclical sector I’d expect a lofty valuation with those growth prospects. But with the share price near 6,477p, the forward-looking earnings multiple for 2021 is just above nine. And the anticipated dividend yield is a little under 7%. That valuation looks undemanding. But when cyclical businesses are posting big profits, the stock market tends to compress their valuations. That happened with the London-listed banks over the past decade before the Covid crash, for example. And I think it could be happening with Rio Tinto. So, as profits perhaps continue to rise in the years ahead, the valuation could contract to account for those increases rather than the share price going up. And I reckon that could happen because the next cyclical down-leg is coming. We just don’t know exactly when! Rio Tinto may prove to be a decent investment from where it is now. But I’ll watch from the sidelines for the time being. However, I’d take a close look at this one. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading 1 FTSE 100 stock from my best shares to buy now list I reckon these 2 FTSE 100 dividend stocks may be among the best shares to buy now What’s next for Rio Tinto’s dividend? Kevin Godbold has no position in any 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. The post Why I’d shun this high-yielding FTSE 100 stock that ticks a lot of investors’ boxes appeared first on The Motley Fool UK.
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  19. My ‘best stocks to buy’ list: I think these 2 UK shares could have passive income potential (13/02/2021 - The Motley Fool UK)
    Some UK shares are yet to return dividend payouts to their previous levels. Others continue to offer a relatively high passive income. Certainly, there’s no guarantee dividends will ever be paid by any company. And, with the global economy’s outlook being very uncertain at the present time, this risk is perhaps amplified. However, these two UK stocks could offer growing dividends over the coming years. As such, they could be among the best stocks to buy now. They could generate a worthwhile and rising income stream in the long run. A high passive income relative to other UK shares Financial services company Legal & General (LSE: LGEN) recently laid out its plans to deliver a rising dividend over the coming years. It estimates it’ll be able to deliver a rise in its passive income in the low to mid-single digits in the period between 2021 and 2024. This could mean its payout grows at a faster pace than inflation. And that may make it increasingly attractive should a loose monetary policy prompt a faster-rising price level. With a dividend yield of over 7%, the stock is already one of the highest-yielding shares in the FTSE 100. When coupled with its dividend growth rate, as well as a forecast dividend cover of 1.5 times in the current year, its passive income investing potential seems to be high. Certainly, Legal & General’s passive income prospects could be dealt a blow by a weak economic performance. This means that its future payouts are by no means guaranteed. However, its high yield suggests there’s a wide margin of safety on offer. And could lead to impressive income returns for investors in the long run. One of the best UK stocks to buy now? Another FTSE 100 stock that could offer a strong outlook when it comes to making a passive income is Berkeley (LSE: BKG). The housebuilder recently updated the market on its performance. It added four new sites to its development pipeline in the first half of the year. Meanwhile, it remains on track to return £280m per year through dividends and/or share buybacks. In the current year, Berkeley’s dividend yield is forecast to be around 4.4%. Its financial position is relatively secure, owing to its net cash position of £954m. This should mean it’s able to maintain its dominant market position in London through the market cycle. This could lead to a more robust and reliable passive income than many of its sector peers can offer. Of course, the company’s future prospects are very dependent on those of the UK economy. As such, it could produce disappointing returns at times. However, with a generous passive income and a solid market position, it appears to offer a relatively attractive passive income for the long term. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading UK share investing: one of the best FTSE 100 shares I’d buy in my ISA right now 2 FTSE 100 shares I’d buy today for passive income 2 FTSE 100 UK shares I’d buy for 2021 Cheap UK shares with high dividend yields: 2 FTSE 100 stocks I’d buy today Why I’m avoiding the Reddit trader frenzy and buying this top UK stock instead Peter Stephens owns shares of Berkeley Group Holdings and Legal & General Group. 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 post My ‘best stocks to buy’ list: I think these 2 UK shares could have passive income potential appeared first on The Motley Fool UK.
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  20. My 3 top FTSE 100 shares for extra dividend income! (11/06/2021 - The Motley Fool UK)
    On Tuesday, I wrote about my love of dividends: the regular cash payments paid by some companies to shareholders. Over the years, this passive income has really built up, contributing tens of thousands of pounds each year to my family portfolio. But most London-listed stocks don’t pay dividends. What’s more, just 10 FTSE 100 companies accounted for over half (54%) of all dividends in 2020, according to investment group A J Bell. As a dividend-loving investor, I’m always seeking high-yielding shares to add to my family portfolio. For me, one good place to look for chunky dividends is in the FTSE 100, where I see plenty of hidden value. Here are three Footsie dividend dynamos that I’d consider buying for their generous passive income. FTSE 100 stock #1: BATS (9.7%) British American Tobacco (LSE: BATS) is the world’s largest cigarette manufacturer. This makes BATS a stock for ethical and socially responsible investors to avoid. But BATS has been a FTSE 100 dividend darling for decades. The business — founded 119 years ago in 1902 — had global sales of £25.8bn in 2020. These huge revenues generate enormous cash flows, much of which is returned to shareholders as cash dividends. At Thursday’s closing price of 2,818.5p, BATS is valued at £64.6bn, making it a FTSE 100 super-heavyweight. At this level, BATS shares trade on a price-to-earnings ratio of 10.3 and an earnings yield of 9.7%. The dividend yield of nearly 7.6% a year is among the five highest yields in the Footsie. That’s why I regard this smoking stock as a top investment for income-seekers like me, although I don’t own BATS yet. Income share #2: LGEN (6.4%) Having worked in the insurance industry for 15 years, Legal & General Group (LSE: LGEN) is one British business I’ve grown to admire. As a household name founded in 1836, almost everyone in the UK knows of this leading provider of life assurance, savings, and investments. Today, L&G manages over a trillion pounds of wealth for more than 10m customers. In short, L&G is a class act in its sector — but it also faces intense competitive pressure from massive global rivals. On Thursday, L&G shares closed at 273.5p, valuing the group at £16.4bn — a FTSE 100 middleweight. Currently, this stock trades on a price-to-earnings ratio of 13.1 and an earnings yield of 7.6%. L&G’s dividend yield of 6.4% a year is among the top 10 in the Footsie. It’s pretty rare that I get such a high cash yield from such a solid business, which is why L&G is on my buy list for passive income. High-yield stock #3: GSK (5.7%) My third stock is pharmaceutical giant GlaxoSmithKline (LSE: GSK). This FTSE 100 share has jumped +17.3% from its 26 February low — good news for me as a GSK shareholder. I’ve held onto them for decades as the price has zigzagged between £10 and £20 since 2000. My loyalty comes simply because this global healthcare Goliath has paid an 80p-a-share dividend for the past five years. At Thursday’s closing price of 1,396.6p, this translates into a dividend yield above 5.7% a year. This £69.5bn FTSE 100 titan’s shares currently trade on a price-to-earnings ratio of 13.2 and an earnings yield of 7.6%. The next quarterly dividend of 19p is due to be paid on 8 July to shareholders as at 20 May. For now, I’ll keep holding this stock, although GSK plans to cut its dividend in 2021/22. However, if the coming cut is more than, say, 25%-30%, then I might finally sell and move on. The post My 3 top FTSE 100 shares for extra dividend income! appeared first on The Motley Fool UK. The Motley Fool UK's Top Income Stock… We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign. But with this opportunity it could get even better. Still only 55 years old, he sees the chance for a new “Uber-style” technology. And this is not a tiny tech startup full of empty promises. This extraordinary company is already one of the largest in its industry. Last year, revenues hit a whopping £1.132 billion. The board recently announced a 10% dividend hike. And it has been a superb Motley Fool income pick for 9 years running! But even so, we believe there could still be huge upside ahead. Clearly, this company’s founder and CEO agrees. Learn how you can grab this ‘Top Income Stock’ Report now More reading How I’d invest £500 in UK shares today Should I buy British American Tobacco (BATS) shares? The BATS share price gives an 8% dividend yield. I’d buy now 2 top dividend stocks with 6% yields My top FTSE 100 stocks to buy in June Cliffdarcy owns shares of GlaxoSmithKline. The Motley Fool UK has recommended GlaxoSmithKline. 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.
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  21. The FTSE 100 shares I’d buy today with £3,000 (12/06/2021 - The Motley Fool UK)
    As the FTSE 100 continues to recover through 2021 from last year’s difficulties, these two shares from the index are those that I’m most likely to buy with any spare cash. High yielding FTSE 100 share First up is SSE (LSE: SSE). As I pointed out last month, I think SSE is ideal for ESG investing. With more and more ‘professional’ money (that of fund managers and pension funds) going into ESG, that could really benefit a company like SSE. The energy company has been transitioning to renewables for a long time so has a head start on many of the oil companies that are now trying to catch up.  It operates in the UK and Ireland so is focused on socially and politically stable countries, which lessens the risk of nasty surprises that can come with operating in some parts of the world. For example, the UK government is unlikely to nationalise or seize assets, or not pay what is contractually obliged.  I think SSE presents a turnaround opportunity as well, so has some appeal for me as a value investment. The forward P/E is only 16, which given the improvement at the company, is still quite modest. I like that between 2020 and 2021 operating profit and ROCE are expected to improve dramatically. It’s this investment, known as capex, which is an ongoing risk, however. The amount of money needed to meet its ambitions for producing renewable energy is very high. That puts pressure on the dividend and the balance sheet. Dividend cover has also been low for some years, putting further pressure on shareholder rewards.  The high-margin housebuilder  Housebuilder Persimmon (LSE: PSN) is a very different company to SSE. But I think it’s one of the best long-term holds among the builders because of its high margins and return on capital employed (ROCE). Its operating margin in 2020 was 23.5%, while the ROCE was 20.9%. These numbers fell, I suspect, mainly because of the pandemic and therefore could bounce back with the recovery. If that’s the case, it could further boost the share price. On top of that, it has a forward P/E of around 12.5, so seems to me to represent very good value.  There’s some growth potential with the Persimmon share price too, but mostly I see it as a quality stock that provides very good income. The dividend is being restored after a temporary suspension during the the pandemic. And I suspect it could grow strongly in the coming years. But the company is very tied to the UK economy and a rise in interest rates could hit it hard as demand for mortgages, and therefore houses, might fall. Any repeat of building-quality issues, which it has had in the past, could also tarnish its reputation and share price.  SSE and Persimmon are both strong dividend-paying shares that I’d likely add to my portfolio with any spare cash. Both provide income that would compound over time and grow year-on-year. Both provide essential products (electricity and homes, respectively). They won’t go out of demand or become obsolete because of technological changes. This is why I think they’re great long-term businesses. The post The FTSE 100 shares I’d buy today with £3,000 appeared first on The Motley Fool UK. The Motley Fool UK's Top Income Stock… We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign. But with this opportunity it could get even better. Still only 55 years old, he sees the chance for a new “Uber-style” technology. And this is not a tiny tech startup full of empty promises. This extraordinary company is already one of the largest in its industry. Last year, revenues hit a whopping £1.132 billion. The board recently announced a 10% dividend hike. And it has been a superb Motley Fool income pick for 9 years running! But even so, we believe there could still be huge upside ahead. Clearly, this company’s founder and CEO agrees. Learn how you can grab this ‘Top Income Stock’ Report now More reading Where will the Taylor Wimpey share price go in June? 2 FTSE 100 dividend shares I’d buy and aim to hold for 10 years 3 top FTSE dividend shares to buy now Can the Persimmon share price keep climbing? UK shares to buy: I’d invest £3k in these stocks Andy Ross owns shares in Persimmon. 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.
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  22. Monthly Income From Dividends - Building a portfolio to maximise returns for reinvestment every month. (26/04/2021 - Reddit Stocks)
    Hello everyone, I’ve basically been working on trying to build a monthly income from high yielding monthly paying dividends and just wanted some clarification on workings and whether the below would work. I have downloaded a spreadsheet of all the monthly dividend paying companies, and work out the best value for money based on dividend yield and price. Appreciate there will be some price differences between the below and current as this was put together some time ago. I also understand that dividend payments can change and price fluctuations could effect income and P/L. I also understand that using this method may not draw out the ‘best’ companies. OXSQ - $4.65 - 9% Yield ($0.04 Monthly) - $13,953 - 3001 Shares PBA - $28.54 - 6.9% Yield ($0.22 Monthly)- $15,599 - 547 Shares PFLT - $11.98 - 9.5% Yield ($0.09 Monthly) - $15,914 - 1328 Shares PSEC - $7.81 - 9.2% Yield ($0.057 Monthly) - $16,388 - 2098 Shares AGNC - $16.89 - 8.5% Yield ($0.115 Monthly) - $17,551 - 1039 Shares DX - $18.97 - 8.5% Yield ($0.128 Monthly) - $17,805 - 939 Shares So does this mean for roughly $97,000 I can get paid roughly $720 per month? I’m from the UK so it basically translates to £71k for roughly £570 per month. The plan is to slowly build the portfolio, one stock at a time achieving the total number of shares to provide roughly £100pm, reinvesting the dividends as I go. I will eventually (if achieved) continue to add more ‘secure companies’ paying monthly/quarterly dividends stocks (AT&T Etc). Just wanted to know peoples thoughts, risks, advantages / disadvantages and whether this would be feasible. Thanks!   submitted by   /u/Smouty95 [link]   [comments]
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  23. Here’s a FTSE 100 high-yielding stock I’d buy right now (03/03/2021 - The Motley Fool UK)
    There’s a lot to like in today’s full-year report from housebuilding company Persimmon (LSE: PSN). Of course, the pandemic dented profits a bit in 2020. But I find some of the other figures to be encouraging. And judging by this morning’s buoyant share price action, other investors agree. Why I’d buy this FTSE 100 high-yielding stock The lockdown restrictions contributed to a decline of just over 14% in new home completions. And that led to a fall in total revenue of almost 9% compared to 2019. But Persimmon still managed to complete 13,575 new homes in 2020, which strikes me as a worthwhile contribution to the UK’s housing stock. Meanwhile, in 2020 we saw a robust housing market. And the company’s selling prices rose by nearly 7%. The average new Persimmon house sold for £230,534. And I’ve been amazed at how well my own property has appreciated in the almost six years I’ve owned it. Perhaps the lesson is how important it is for investors to focus on asset diversification. I’ve got a decent split between property and shares, for example. And the approach has served me well. Beneath the challenges of the pandemic, the long-term supply and demand characteristics of the UK housing market are good for housebuilders. And the government seems committed to supporting the market on an ongoing basis. Those tailwinds have powered Persimmon’s business for some time, and they show up in today’s results as well. For example, forward sales rose by almost 15% in 2020 to £2.27bn. And the company’s cash balance shot up by just over 46% during the year. On 31 December, the figure for net cash on the balance sheet stood at just over £1,234m. And Persimmon has negligible borrowings. Robust finances The finances are robust. But they should be. Persimmon has been trading well with bumper profits for years now. But we should never forget it’s a cyclical business. If we didn’t have the happy set of economic circumstances I’ve outlined, Persimmon could drop like a stone. It makes a great deal of sense for housebuilders to trade their metaphorical socks off while the going is good. And for them to salt away every penny for the bad times ahead when the bottom might eventually fall out of their businesses. But Persimmon has been spinning out bumper shareholder returns for so long, it’s easy to forget the inherent risk in holding the stock. Yet those with eyebrows as long and bushy as mine will remember the company following the credit crunch in the late noughties. Back then, you could hardly find a willing person to take the pulverised shares off your hands. However, now I reckon the company could have a long road ahead with favourable industry economics. And I’m prepared to risk owning a few of the shares in my diversified portfolio. After all, today the directors committed to more generous shareholder dividends ahead “subject to continual board review”. And one of the main features of owning the stock over the past decade or so has been those abundant shareholder cash returns. 5 Stocks For Trying To Build Wealth After 50 Markets around the world are reeling from the coronavirus pandemic… And with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains. But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be daunting prospect during such unprecedented times. Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down… You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm. That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away. Click here to claim your free copy of this special investing report now! More reading Dirt-cheap UK shares I’d buy ahead of the stock market recovery Top British stocks for March 2021 Why I’m still avoiding these 3 popular FTSE 100 stocks Kevin Godbold has no position in any 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. The post Here’s a FTSE 100 high-yielding stock I’d buy right now appeared first on The Motley Fool UK.
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  24. 5 UK shares I’d buy after Budget 2021 (03/03/2021 - The Motley Fool UK)
    The UK’s second largest home-builder, Persimmon (LSE: PSN), was among the big FTSE 100 gainers as today’s stock market session began. This was for a reason. PSN released its final results for 2020 today, making this UK share attractive to investors.  Persimmon leads real estate rally Both Persimmon’s revenue and profits declined in 2020. But investors look to the future value of their capital. And to that extent, PSN gives reason for optimism.  For the first half of 2021, it expects new home completion levels to be almost back to the pre-pandemic levels of 2019. It also expects a 15% increase in forward sales levels.  Budget 2021 supports property markets But the best was yet to come. In its update, Persimmon had said that it was supported by “low interest rates, good mortgage availability and ongoing Government support measures”.  So when Chancellor Rishi Sunak said that the stamp duty waiver will continue up to June and made it easier for borrowers to pay only 5% of deposit, PSN’s share price has gotten an even bigger boost. With these announcements, it is no surprise that other property shares also rallied. FTSE 100 property biggies like Taylor Wimpey, Barratt Developments, and Berkeley Group Holdings are all up at least 2.5% as I write.  FTSE 250 property developers have also seen a rise. Notable among these UK shares are Crest Nicholson Holdings and Bellway, both of which are up by more than 4%. FTSE 100 real estate stocks I can buy now I have long liked all FTSE 100 real estate developers. In fact, they had even come up in the context of potential gainers from this year’s budget in an article yesterday. Choosing which one to buy among them depends on individual criteria. They have similar earnings ratios and dividend yields, and their share prices are still making their way back up to pre-pandemic levels.  I like PSN most based on these. It has the lowest earnings ratio of 13 times among all the FTSE 100 property developers. It also has a relatively high dividend yield of 4%.  FTSE 250 property developers to consider Among the FTSE 250 property developers, the answer is more obvious. Crest Nicholson has taken a bigger hit in 2020 and it showed a loss. It does not pay dividends either.  By comparison, Bellway has managed to stay profitable. I find its dividend yield most attractive at 5%. This is the highest among all property developers I have talked about here. It also has the highest price-to-earnings (P/E) ratio of 20 times, though.  Risks and takeaway for these UK shares The upshot here is this — there are at least five real estate companies’ shares I can consider buying today. I think these UK shares’ long-term record and resilience through the corona-crisis goes in their favour.  At the same time, I need to be cognizant that some of the demand is artificially inflated by policy support. While it could see them through the worst of the economic slowdown that could occur as the schemes are withdrawn, I do need to be realistic about some softening later in the year.  FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading Here’s a FTSE 100 high-yielding stock I’d buy right now Dirt-cheap UK shares I’d buy ahead of the stock market recovery Top British stocks for March 2021 Why I’m still avoiding these 3 popular FTSE 100 stocks Manika Premsingh 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 post 5 UK shares I’d buy after Budget 2021 appeared first on The Motley Fool UK.
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  25. Commercial Realty: A high return yielding instrument in a low-interest regime (19/02/2021 - Financial Express)
    An investment in Grade A commercial premises may be one of the safest bets for a risk-averse investor.
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  26. Rate my port? (14/02/2021 - Reddit Stocks)
    Should I sell my RY, ENB, CM and just buy some ETFs? ​ VOO 31 shares QQQ 27 shares RY.TO 48 shares ENB.TO 100 shares CM.TO 38 shares VGRO.TO 92 shares ARKK 10 shares VFV.TO 11 shares XUU.TO 22 shares ARKG 3 shares XIT.TO 7 shares VCN.TO 9 shares   submitted by   /u/FeignNewb [link]   [comments]
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  27. 3 FTSE 100 shares I’d consider using Warren Buffett principles (31/03/2021 - The Motley Fool UK)
    Legendary investor Warren Buffett generally applies clear principles when choosing shares to buy. He sets these out in his annual shareholder letters. That makes it easy to acquire knowledge from this talented investor. I often apply these principles to my own share selection. Here are three UK shares which I would consider buying right now. Each one offers some fit with Warren Buffett style investing principles, in my view. Strong brands Unilever is the multinational consumer goods company behind popular brands such as Dove and Surf. Its focus on building distinctive brands helps give it what Warren Buffett calls a business moat. A business moat is like its namesake around a medieval castle: something that helps make it more defensive. Brands do this by making customers more loyal, which gives a company pricing power. That helps explain why Buffett holds shares in consumer goods companies with strong brands, such as Unilever rival Procter & Gamble. Unilever currently yields 3.6%, though dividends are never guaranteed for any shares. Risks include any downturn in demand and the impact of heavy expenditure in making its operations more environmentally sustainable. Drinks companies and Warren Buffett Another company with a collection of strong brands I would consider for my portfolio is Diageo. The owner of Johnnie Walker, Baileys, and Guinness has a wide-ranging set of brands across lots of drinks categories. The high profit margins in the alcohol business help demonstrate the pricing power that brands can command. So, as with Unilever, I think Diageo has a strong business moat. Warren Buffett also likes companies whose customers buy frequently. He has often talked about his holding in Coca-Cola in these terms. As a shareholder, he gets a sliver of profit millions of times each day when someone drinks a bottle. It typically costs money for a business to recruit a new customer to its franchise. Keeping them and getting them to buy again is usually cheaper. So a business model in which customers buy a product frequently is usually more attractive to me one in which sales are spaced far apart. Diageo has a strong dividend record, with its dividend growing 5.4% on average over the past decade. The yield currently stands at 2.3%. One risk is the decline of alcohol consumption, which I have noticed picking up speed among many younger, health-conscious consumers. Business moat Warren Buffett’s company Berkshire Hathaway owns energy assets in the UK. Its subsidiary, Northern Powergrid, supplies nearly 4m customers in northeast England. Power grids are a classic Buffett pick. The high capital cost lends itself to a form of natural monopoly. Also, even if competitors wanted to build another grid, often governments would not allow them. Pricing is also often subject to regulatory control, potentially limiting profits. But the high barriers to entry in electricity generation and transmission networks make me view this sector as an attractive investment using Warren Buffett principles. FTSE 100 member National Grid runs such a network. The share is yielding over 5%. Its infrastructure assets provide an attractive business moat, in my view. The immobile nature of assets like transmission networks is a risk for National Grid, like many power companies, as it makes it more captive to political and regulatory risks. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading 1 penny stock I’d buy today What the Deliveroo IPO means for my FTSE 100 investments I would buy Manchester United stock today What can I do if my benefits are cut? Why I’d pick the FTSE 100’s 2 highest yielding shares christopherruane owns shares of Unilever. The Motley Fool UK owns shares of and has recommended Berkshire Hathaway (B shares). The Motley Fool UK has recommended Diageo and Unilever and recommends the following options: short January 2023 $200 puts on Berkshire Hathaway (B shares) and long January 2023 $200 calls on Berkshire Hathaway (B shares). 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 post 3 FTSE 100 shares I’d consider using Warren Buffett principles appeared first on The Motley Fool UK.
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  28. 1 FTSE 100 dividend stock with a 6% yield that I’d buy right now (19/04/2021 - The Motley Fool UK)
    Last year, several large FTSE 100 companies decided to cut dividends due to the impact of the pandemic. This was to retain earnings and cash within the business in order to help operations. However, not all companies suffered during this period, and some continued to pay out funds to investors. Legal & General (LSE:LGEN) is one example in this regard. That underlines why I think it’s a top FTSE 100 dividend stock that’s worth me buying now. A resilient 2020 Legal & General is a financial services company that operates mainly in the asset and investment management space. The asset management arm is focused on markets here in the UK and in the US. The investment management arm is broader and has operations in many countries around the world.  Despite profit after tax falling 12% last year due to the pandemic, there were multiple positives to be taken away from it. What impressed me was the growth in the pension space, particularly in the US. It generated over $1.6bn in premiums in 2020, up 40% from 2019.  I think the outlook for 2021 remains positive as well. The company noted that it expects a lot of “repeat buyers” with key products, and described the UK as having a “healthy outlook”. Over the past year, the share price has risen around 43%. I think this attests to the resilience shown by the business during a tough period. Besides this, Legal & General also acts as a FTSE 100 dividend stock. The dividend yield currently sits at 6.3%. This puts it inside the top 10 highest yields available in the FTSE 100 index right now. Is this dividend stock sustainable? With interest rates low and some companies cutting dividends, a FTSE 100 stock with a dividend yield above 6% is high. I think that it’s sustainable though. The credit portfolio has had no defaults thus far, and is being actively managed. So I don’t see any immediate risk of having to tie up reserve funds due to potential bad debt. Of course, this could change, but at the moment it isn’t something that concerns me. Although not directed related to the sustainability of dividend payments, the business is clearly very solvent. Due to EU regulations, life insurers have to meet certain solvency ratios. This measures the amount of capital held versus liabilities. It should be enough to ensure that clients have a high chance of getting money back in the case of default. As of the end of Q1 this year, Legal and General estimated its Solvency II ratio to be at 192%, much higher than the required minimum. This was also up from the 2019 figure. This gives me confidence that the company isn’t in distress, and should continue to be a reliable FTSE 100 dividend stock. One potential downside with buying this stock for dividends is that there’s unlikely to be any large upside in dividend payouts in coming years. A new five-year strategy piece commented that from 2021 onwards the board intends to grow dividends “at low-to-mid-single-digits”. So from this angle, I could be better off finding a company that intends to grow dividends substantially going forward. Overall, I think Legal & General is a solid FTSE 100 dividend stock and would look to buy it for my portfolio. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading Shares for passive income: my dividend heroes This is what I’d do about the Legal & General share price Three 6%+ yielding FTSE 100 UK shares I’d pick today jonathansmith1 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 post 1 FTSE 100 dividend stock with a 6% yield that I’d buy right now appeared first on The Motley Fool UK.
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  29. I’d buy this FTSE 100 dividend stock with a 8% yield for my ISA right now (16/03/2021 - The Motley Fool UK)
    In the world of low interest rates that we’ve been in for the past year, hunting for yield has become more important to me. Some FTSE 100 dividend stocks can offer me a higher yield than I would get via alternative income paying investments. As the impact of the pandemic eases, I’ve started to see more companies reinstating dividends, or increasing the size of the dividend.  Whichever stock I choose to buy, I’m keen to put it in my ISA before the April deadline. This is because I’ll lose any of my allowance that I haven’t used up when the new ISA year starts. Holding the FTSE 100 dividend stock in the ISA allows me to collect the dividends gross, without having to pay tax on them. Strong results from a FTSE 100 stock One stock that I’d look to buy right now is Persimmon (LSE:PSN). The UK-based homebuilder currently offers me an attractive 7.98% dividend yield. This means for a £1,000 investment, I’d be picking up just shy of £80 a year in passive income. Persimmon is in a position to offer a generous dividend yield for a few reasons. The primary one is that it has plenty of free cash to distribute. Full-year results showed that cash increased from £843.9m in 2019 to £1,234.1m in 2020. This was helped in part by the large profit margins that Persimmon has. Gross profit margin stood at 31%, and even the operating profit margin was high at 27.6%. Ultimately, the higher the profit margin, the larger the profit. The larger the profit, the higher the cash generated that can be distributed to shareholders. Safe as houses? I think that the outlook for the FTSE 100 stock is positive, supporting the paying of dividends going forward. The average selling price was up 6.9% in 2020, to over £230,000. If house prices remain stable and continue to tick higher, this will support the business. I’m also conscious of the continued boost that the stamp duty holiday will have. A major spanner that could be thrown into the works would be any kind of re-introduction of lockdown later this year. Persimmon incurred £8m in costs to ensure a Covid-secure working environment last year. Even with construction being an industry that has been able to operate more than others during the pandemic, higher costs are a risk. If these costs increase, and access to raw materials and transportation is hindered, housing projects could be delayed. In turn, this may decrease free cash flow, with a small possibility of reducing the dividend yield. The eventual end of government schemes to help house-buyers could also hurt the firm one day. I’m personally ok with the above risk. The success of the vaccination programme so far leads me to conclude that this lockdown will be our last in the UK. Also, £8m in costs sounds a lot, but when you consider the profit before tax of £863m, it’s definitely manageable. Overall, I think this FTSE 100 dividend stock allows me to have a home for my money that will generate sustainable passive income. The dividend yield is attractive, and one that I think is relatively safe going forward. On this basis I’d look to buy Persimmon shares for my ISA. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading 5% and 9% dividend yields! 2 of the best shares to buy now 2 of the best FTSE 100 shares I’d buy now 5 UK shares I’d buy after Budget 2021 Here’s a FTSE 100 high-yielding stock I’d buy right now Dirt-cheap UK shares I’d buy ahead of the stock market recovery jonathansmith1 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 post I’d buy this FTSE 100 dividend stock with a 8% yield for my ISA right now appeared first on The Motley Fool UK.
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  30. Shares for passive income: my dividend heroes (17/04/2021 - The Motley Fool UK)
    Shares that can produce a passive income strike me as key to helping me grow the value of my investment portfolio. With that in mind, these are my two dividend heroes – the shares I think can provide a growing passive income in my Stocks and Shares ISA. A FTSE 100 share for passive income Legal & General (LSE: LGEN), which has just gone ex-dividend this week, is one of the biggest dividend payers on the FTSE 100. It has a dividend yield of over 6%.   The dividend for me is a major attraction. As well as being high-yielding, the dividend has also grown. It has gone from 14.35p in 2016 to 17.57 in 2020, while other insurers cut their dividends because of the pandemic.  Alongside that, there is balance sheet strength, profitability, and growth opportunities in the US and Asia. Legal & General, through its annuities business and investing, is also tapping into long-term trends around climate change, the need for high-quality housing, and an ageing population. When it comes to risks, the company as an investor is reliant on the markets – both equities and bonds. A collapse in either could be damaging for Legal & General as an insurer and investor. The company itself notes that it holds a significant portfolio of corporate bonds to back its pension risk transfer and annuities business. The pricing of long-term life insurance business requires the group to make assumptions about future trends in life expectancy. That creates a risk — if customers live longer than assumed in the models, it will require an increase in reserves and reduce Legal & General’s profits. Despite these risks, Legal & General strikes me as being a share that can deliver long-term growing passive income, which is why I like the insurer.  A housebuilder with a high dividend yield Another share I like for passive income is FTSE 100 housebuilder Persimmon (LSE: PSN). Persimmon has declared a full-year dividend of 110p per share, less than half the 235p it paid for 2019. On a brighter note, it said it was committed to a total payout of 235p per share in 2021. Based on the current share price that works out as a dividend yield of around 7.3%. It’s the increase in the dividend that gives me confidence in Persimmon is a good passive income share. The cash on the balance sheet of £1.2bn can also help the housebuilder pay the dividend. Operationally I think it’s one of the strongest UK housebuilders. It had around 127,000 plots at the end of 2020, indicating plenty of land on which it can build for years to come. Many of its customers are first-time buyers meaning it can benefit from government support for the sector, which tries to help this group the most. The downsides are the possibility government might withdraw support from the sector, which would cause a major slump in demand. There’s the possibility of costs going up which would hit margins and has happened in the not too distant past. There may also be ongoing reputational damage from its past building quality issues. To recap, I think Legal & General and Persimmon are both dividend heroes. Both seem to be shares that can help me benefit from compounding and create a passive income that can help me achieve my financial goals through their large dividend payments. 5 Stocks For Trying To Build Wealth After 50 Markets around the world are reeling from the coronavirus pandemic… And with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains. But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be daunting prospect during such unprecedented times. Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down… You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm. That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away. Click here to claim your free copy of this special investing report now! More reading This is what I’d do about the Legal & General share price Three 6%+ yielding FTSE 100 UK shares I’d pick today 2 of the best UK high-dividend shares to buy today The Taylor Wimpey share price: value or not? Andy Ross owns shares in Persimmon and Legal & General. 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 post Shares for passive income: my dividend heroes appeared first on The Motley Fool UK.
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  31. These UK shares have doubled and still yield over 7% (20/05/2021 - The Motley Fool UK)
    I like dividend-paying shares because the extra income can come in handy. Whether I spend it or reinvest it, dividend income is an important part of my investing strategy. So I’m always hunting for UK shares that offer an attractive dividend yield. Below I discuss one 7%+ yielding stock I’d consider picking for my portfolio. High-yield UK shares The stock in question is FTSE 100 member M&G (LSE: MNG), a well-known financial services provider in the UK. It was demerged from Prudential in 2019. I think due to its newness as an independent listed company, analysts have struggled to value it. That could explain why its yield has been among the highest in the FTSE 100. The company is best known for its asset management business. Last year, assets under management and administration rose 4% to £367bn. M&G dividend The company announced in March that it would raise its dividend. The payout for the full year came to 18.23p per share, made up of a 6p interim dividend and 12.23p final one. At the current share price, that’s a 7.7% yield. Among UK shares, I find that attractive. The M&G share price doubled in the past year. So today’s 7%+ yield looks attractive to me, but if I had got in this time last year I would now be looking at a yield of 15%. That’s far ahead of the market average. Is that a red flag? One reason these UK shares were marked down last year was the brevity of the company’s dividend history. But another was concern about how the asset management industry would fare. Amidst the economic downturn last year, it was unclear what the outlook would be for a company like M&G. I think that risk remains for an investment management firm such as M&G. If an economic downturn leads to less customer appetite for investments, revenues and profits could fall. M&G dividend sustainability One of the things I look at when a company has a high dividend is its sustainability. For the past couple of years, the dividend has been covered more than twice by earnings. The dividend was also covered by free cash flow. The company structure makes for a slightly complicated calculation, but it highlights cash remittances of £737m last year. That more than covered the cost of the dividend, at £562m. The disparity between revenues and earnings reflects the structurally low profit margins of the investment management sector. But for now, I see no reason why the dividend could not be supported in the future. However, dividends are never guaranteed. A shift in profitability could cut the company’s ability to pay out dividends, for example because of a more competitive landscape in investment management. Would I buy these UK shares? The M&G yield is attractive to me. I like the company’s strong brand and its commitment to a progressive dividend. I think its exposure to investment management at a time when many people have saved more than usual could be positive. With its 7%+ yield, I would consider buying M&G shares for my portfolio today. The Motley Fool UK's Top Income Stock… We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign. But with this opportunity it could get even better. Still only 55 years old, he sees the chance for a new “Uber-style” technology. And this is not a tiny tech startup full of empty promises. This extraordinary company is already one of the largest in its industry. Last year, revenues hit a whopping £1.132 billion. The board recently announced a 10% dividend hike. And it has been a superb Motley Fool income pick for 9 years running! But even so, we believe there could still be huge upside ahead. Clearly, this company’s founder and CEO agrees. Learn how you can grab this ‘Top Income Stock’ Report now More reading The best shares to buy now: 3 FTSE 100 bargains christopherruane has no position in any of the shares mentioned. 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. The post These UK shares have doubled and still yield over 7% appeared first on The Motley Fool UK.
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  32. 2 shares to buy today for my Stocks and Shares ISA (03/03/2021 - The Motley Fool UK)
    The pandemic has had a significant effect on UK shares. Some stocks have gained over the last 12 months, while many others have seen their value fall. Looking at FTSE 100 shares, for the most part stocks are still trading lower than they were 12 months ago, just as the pandemic was beginning to take hold in the UK. There have been signs of a recovery in the last few months, however, with the index gaining 33% since its low of 4,993p in March 2020. I still think there are some UK shares to buy today which I would add to my Stocks and Shares ISA. UK citizens have an allowance of £20,000 for the tax year in which they can receive with an ISA.  While there is more risk involved than in a Cash ISA, I think a Stocks and Shares ISA can be a good way to get started in the stock market. Here’s two shares I’d buy today for my Stocks and Shares ISA. Rio Tinto Mining giant Rio Tinto (LSE:RIO) is a company with a strong record of growth over the years. Its share price has gained more than 220% over the last five years. In a recent trading update, Rio Tinto announced it would be paying out a record dividend of $3.09 per share in addition to a special dividend of 93 cents per share. The company also said its full-year profits had climbed 22%, as strong demand for iron ore led to an increase in the price of the commodity.  If the global economy is able to return to some sort of normality over the next 12 months, I think this demand could grow even faster and boost Rio Tinto’s profits and share price even further. The major risk is that commodity markets such as iron ore can often be cyclical in nature. As Rio Tinto is experiencing significant growth right now based on soaring iron prices, a fall in these prices is certainly possible.  Intermediate Capital Group The Intermediate Capital Group (LSE:ICP) share price suffered a decline last week, but the shares have performed solidly in recent years. The stock has gained more than 10% over the last 12 months, while that figure is just short of 70% over the last two years. The asset manager entered the FTSE 100 after a period of sustained growth, and has continued that form to see its market capitalisation edge over £5bn. Assets under management, a key measure of growth for those in the sector, have consistently grown for the business. In a January trading update, the company reported total assets under management rose 2% in the three months to 31 December, to €47.2bn. Intermediate Capital says it is “well positioned to continue this trajectory” and if that is the case I think its share price can also continue to grow. On that basis I would add it to my list of shares to buy today. Like other financial services firms, the company is subject to economic weakness due to the ongoing Covid-19 pandemic. Its profits have been underwhelming at times over the last few years, so there is a risk to buying the shares right now. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading Stock market rally: I’d invest £2,000 today in these top UK shares Why I’d shun this high-yielding FTSE 100 stock that ticks a lot of investors’ boxes 1 FTSE 100 stock from my best shares to buy now list conorcoyle 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 post 2 shares to buy today for my Stocks and Shares ISA appeared first on The Motley Fool UK.
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  33. 2 of the best FTSE 100 shares I’d buy now (06/03/2021 - The Motley Fool UK)
    Last week’s budget received a favourable response from the stock market. When I checked, 62 FTSE 100 shares were showing gains by mid-afternoon. Today, I want to look at two FTSE stocks I think offer a good package of dividend income and growth potential. They’re both shares I’d consider buying for my own portfolio. When cash is king… When times are tough, there’s no substitute for cash in the bank. FTSE 100 housebuilder Persimmon (LSE: PSN) had net cash of £895m at the end of 2020, excluding money owed for land purchases. I think having plenty of surplus cash should give Persimmon’s management the freedom to make the right decisions for long-term growth. When I pair this with the government’s latest measures to support house prices, I’m not surprised Persimmon’s share price closed up 6% on Budget Day last week. Stable house prices at current levels make Persimmon a very profitable business. The group’s 2020 results show the company generated an underlying gross profit margin of 31% on new housing last year. That’s only a slight reduction from 33% in 2019, despite the disruption caused by the pandemic. Although Persimmon’s pre-tax profit fell by 25% to £783m last year, the company ended the year with forward sales of £2.3bn, a 15% increase on 2019. Management expects new home completions to return to 2019 levels in 2022. This FTSE 100 share has become known for its generous dividend in recent years. Last year saw the payout cut to 110p, but Persimmon’s management has committed to return to a 235p annual payout in 2021. That gives a dividend yield of more than 8%. When I buy housebuilder shares, I’m always aware of the risk that the housing market could crash. Lower selling prices could quickly crush Persimmon’s profits. In my view, house prices have been relatively high for a long time now, so I’d say there’s some risk we could be heading for a downturn. However, there’s no sign of any slowdown so far, so this is a stock I’d be happy to own at the moment for its generous income. A FTSE 100 share with growth potential? The second stock I’ve been looking at is FTSE 100 packaging group Mondi (LSE: MNDI). This business benefited from strong demand for e-commerce packaging last year, which helped to offset weaker demand from industrial companies. I believe sustainable packaging will be a growth market for the foreseeable future. Aside from the obvious growth in online retail, I think there’s probably a lot of room for improvement in areas such as replacing plastic with cardboard-based products. Like Persimmon, Mondi generates attractive profit margins and strong cash flows. Although higher raw material costs contributed to a 30% drop in profits last year, Mondi’s earnings still covered the dividend payout twice. My main concern with this FTSE 100 share is its debt levels are relatively high, by the standards I like to use. I’m also aware that profits can be quite variable, due to the impact of changing wood and pulp costs — Mondi’s raw materials. However, no share is free of risk. There’s always something that can go wrong. But Mondi’s stock currently trades on 15 times forecast earnings, with a 3.3% dividend yield. So, I’d be happy to buy at this level for a long-term holding. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading 5 UK shares I’d buy after Budget 2021 Here’s a FTSE 100 high-yielding stock I’d buy right now Dirt-cheap UK shares I’d buy ahead of the stock market recovery Top British stocks for March 2021 My 2 favourite FTSE 100 stocks right now Roland Head 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 post 2 of the best FTSE 100 shares I’d buy now appeared first on The Motley Fool UK.
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  34. The Vodafone share price is near its one-year high. Would I buy today? (15/04/2021 - The Motley Fool UK)
    The Vodafone (LSE: VOD) share price, after a blip in late February, has been doing rather well of late. A year ago it was 108p but at today’s 134p, it’s closing in on the one-year high of 142.44p. The shares clearly have momentum. The question is whether Vodafone is just following the FTSE 100 higher or is there more to it than that? In other words, could it outperform the FTSE 100 and therefore, would I prefer to buy and hold Vodafone rather than invest in another share or buy a FTSE 100 tracker?  Why the share price is riding high I think one of the main catalysts for Vodafone’s share price growth is that the telecoms operator raised €2.3bn from spinning out its towers business. Another is likely the opportunity it has to generate revenue from 5G. The UK auction has just been held and Vodafone snapped up 40 MHz, at 3.6 GHz for £176m. It remains to be, of course, seen to what extent the faster speeds can be commercialised by telecoms companies. One of the bigger factors I think might be helping Vodafone is simply investor appetite for value shares like this, and the market generally going up in recent times. In the year to date, for instance, the FTSE 100 has gone from 6,572 to 6,939, at the time of writing. I like Vodafone’s dividend yield and I strongly suspect many other investors do too. Since cutting the dividend drastically in 2019, the payout to shareholders has recovered. The shares now yield 5.8%. This is very attractive from an income point of view and makes it a high-yielding share compared to other FTSE 100 companies.  What are the risks with this share? For me, there are at least two major risks facing Vodafone investors. One is its huge debt. Vodafone’s debt pile has reached €44bn, thanks primarily to the recent acquisition of Liberty Global assets in Europe. A net debt-to-EBITDA ratio of over three times appears quite high to me and adds to my concerns about debt. Spinning out the towers business will help reduce some of this debt, but it also takes away a steady source of income.  That’s especially concerning because the second issue with Vodafone is low growth. Between 2016 and 2020, despite some pretty major acquisitions, revenue declined. In 2016 revenue was £48.9bn. By 2020 it had fallen to around £45bn. I’m wary of a company that can’t even buy growth. One might expect acquisitions to have helped improve the top line of the business. The final word Overall, I think the Vodafone share price is starting to look expensive. That’s primarily because the telecoms operator has struggled to grow consistently in recent years. The only reason I’d add Vodafone to my portfolio would be for the income it could provide from dividends. Other than that, to boost my own portfolio, I think I’d prefer to buy another FTSE 100 share, or even an index tracker, rather than Vodafone shares.  5 Stocks For Trying To Build Wealth After 50 Markets around the world are reeling from the coronavirus pandemic… And with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains. But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be daunting prospect during such unprecedented times. Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down… You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm. That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away. Click here to claim your free copy of this special investing report now! More reading I think the Vodafone share price still looks cheap Why I’d buy Vodafone shares before the ISA deadline The Vodafone share price is soaring in 2021! Should I buy the stock now? Andy Ross 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. The post The Vodafone share price is near its one-year high. Would I buy today? appeared first on The Motley Fool UK.
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  35. How I would earn passive income with £50 a week (10/02/2021 - The Motley Fool UK)
    Passive income, or money one receives without working for it, has obvious appeal. Rather than having to work for every pound, at least some of one’s income arrives by cheque or bank deposit without having to lift a finger. A lot of passive income ideas seem a bit far-fetched to me. Instead, I prefer the simple option of putting a bit of money away regularly in a Stocks and Shares ISA then investing it in dividend-paying shares. Here’s how I would start to build a passive income stream by putting aside £50 a week. Set an income target If someone starts a new job, they usually have an idea of what sort of salary they want. It can be useful to apply the same sort of discipline to passive income. Deciding what sort of income one wants can inform your investing strategy. Some companies pay fairly low dividends but have a long record of dividend increases. For example, Spirax-Sarco yields just under 1%, which isn’t attractive to me as an income hunter. What is attractive, however, is that the company has increased its dividend annually for over half a century. That doesn’t mean it will keep doing so, but it is an encouraging sign that the company is committed to dividends. Energy group DCC doesn’t have Spirax-Sarco’s half century of raising dividends, but it has nonetheless raised payouts annually for over a quarter of a century. At 2.5%, its yield is more attractive than Spirax-Sarco’s. I think both companies are well-run and have attractive business models, so would hope for future income from either. By contrast, a higher income target might lead one to higher-yielding passive income ideas. British American Tobacco yields almost 8%, for example. But its core market of smokers has an uncertain future, and it wouldn’t appeal to all investors. Similarly, Evraz yields 11%. But it is in the cyclical mining industry, which makes me wonder whether it will pay out at such a rate in future. Sometimes, higher-yielding shares pay out big dividends for a reason: they have limited new opportunities in which to invest excess cash, for example. Sometimes a high dividend is a signal the market expects lower returns in future. But the market isn’t always right. So, if one’s target income is high, it can be worth looking among the higher-yielding shares to see if any seem more likely to continue offering passive income at the right level. Two passive income ideas I’d buy I think British American Tobacco is such a share. Its 7% yield reflects investor concern about the future of the tobacco market. In developed countries, fewer people are smoking and that could hurt revenues. However, smokers are willing to pay a lot for cigarettes. That gives the company pricing power. With its portfolio of strong brands, long experience, and agreeable yield, British American Tobacco is one of the passive income ideas I’d tuck into my portfolio. I would also pick Legal & General. The well-known insurer’s shares yield just under 7%, which is still an attractive income stream for me. While the financial market can be volatile, Legal & General’s strong brand should help build customer loyalty. It’s another of the passive income ideas I’d pick to sit back and start earning. 5 Stocks For Trying To Build Wealth After 50 Markets around the world are reeling from the coronavirus pandemic… And with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains. But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be daunting prospect during such unprecedented times. Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down… You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm. That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away. Click here to claim your free copy of this special investing report now! More reading Rolls-Royce share price: could the company be a Tesla competitor in the future? This FTSE 100 stock yields over 5%, making it a great passive income opportunity! Should I sell my Diageo shares today? Argo Blockchain: exciting or irrational? 1 FTSE 100 stock from my best shares to buy now list christopherruane owns shares of British American Tobacco. 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 post How I would earn passive income with £50 a week appeared first on The Motley Fool UK.
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  36. I think the BAE share price is one of the FTSE 100’s best bargains (19/05/2021 - The Motley Fool UK)
    BAE Systems (LSE: BA) puzzles me. Over the past five years, we’ve seen EPS up by a total of 16%. That’s not brilliant, but not too shabby either. The 2019 dividend was deferred due to Covid-19. But BAE paid it as part of 2020’s dividends. And that means a modestly progressive dividend over the five years, yielding around 4.5%. But the BAE share price? It has gained just 7.6% over the five years, around half the level of the FTSE 100. And it’s been far more volatile than the index. BAE shares are still lagging the Footsie in 2021, so what’s the company’s outlook like? Judging by the latest trading update on Wednesday, it’s just fine. Chief Executive Charles Woodburn said: “Our good operational performance underlines our confidence in the full-year guidance for top-line growth and margin expansion and our three-year cash targets.“ The update went on to say: “Group sales and underlying EBIT growth expectations in the full-year 2021 guidance remain on track. The guidance across all other metrics is unchanged.“ BAE share price response The market reacted coolly, with barely any movement in the BAE share price. So why are investors so unenthusiastic? As my Motley Fool colleague Royston Wild has pointed out, demand for BAE from institutional firms remains weak. All the environmental, social and governance (ESG) focus is turning these investors towards more fashionable green investments and away from defence. I do think investing in environmentally sound companies is a positive move. But I also reckon defence is one critical industry that will always be in demand, and will keep generating profits. I believe Wednesday’s update reinforces my view. It said: “Our backlog and programme positions support our growth expectations in the coming years, and the pipeline of opportunities across all sectors remains strong. Demand for our capabilities remains high with order intake ahead of expectations.” But, no matter how strong a company’s future might look, isn’t it still a poor investment if the big institutions are wary of it? Doesn’t that mean the shares are destined to remain undervalued? Well, that doesn’t matter in the slightest to me, as an income investor. Sure, if I wanted growth, and wanted it in the next five years, I suspect I wouldn’t get it from the BAE share price. I’d buy for income But I’m looking at a stock here that I reckon can give me a healthy 4.5% annual dividend yield. And if I’m getting 4.5% per year on my money, and I’m not looking to sell for years, why would I worry where the BAE share price goes? In reality, I’d prefer BAE to remain out of favour and undervalued so I can buy — and buy more — in the coming decade or so. Of course, my plan could fall apart if something comes along and hurts the BAE dividend. That could put an end to my 4.5%, and cause the shares to drop further. But with BAE on a trailing P/E of only 11, I think there’s a safety margin that makes up for the risk. I’m very likely to buy BAE in the near future. There’s a ‘double agent’ hiding in the FTSE… we recommend you buy it! Don’t miss our special stock presentation. It contains details of a UK-listed company our Motley Fool UK analysts are extremely enthusiastic about. They think it’s offering an incredible opportunity to grow your wealth over the long term – at its current price – regardless of what happens in the wider market. That’s why they’re referring to it as the FTSE’s ‘double agent’. Because they believe it’s working both with the market… And against it. To find out why we think you should add it to your portfolio today… Click here to get access to our presentation, and learn how to get the name of this 'double agent'! More reading Stock market crash: 1 of the best UK shares to buy in an ISA 3 FTSE 100 dividend shares I’d buy in May 2021 2 cheap penny stocks and 1 FTSE 100 share to buy in my ISA! Alan Oscroft 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 post I think the BAE share price is one of the FTSE 100’s best bargains appeared first on The Motley Fool UK.
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  37. 3 shares to buy today for income (21/02/2021 - The Motley Fool UK)
    I think there are some great income opportunities available on the market right now. With that in mind, here are three shares to buy today for income that I’m currently considering adding to my portfolio.  Shares to buy today One of the highest dividend yields in the FTSE 350 at present belongs to Diversified Gas & Oil (LSE: DGOC). As its name suggests, this company is an oil and gas producer. At the time of writing, analysts believe the group will return $0.14 (10p) per share to investors as dividends for the 2020 financial year. They’ve pencilled in additional distributions totalling $0.17 (12p) for 2021. Based on the current share price of this suggests the stock could offer a dividend yield of 9.4% in the current year.  However, this distribution is far from guaranteed. Commodity prices can be highly volatile. For example, the oil price lost around two-thirds of its value in the first half of 2020. This suggests it could be challenging to rely on Diversified Gas & Oil’s dividend remaining at this level for the long term. Still, I think this is one of the best shares to buy today based on its near-term dividend prospects. That’s why I would buy the stock for my portfolio today.  Income investment Another high-yielding FTSE 350 stock is Investec (LSE: INVP). Based on current analysts projections, the shares could yield 8.3% in 2022.  As well as this income potential, the stock also looks cheap. It is trading at a forward multiple to earnings of 5.8. In comparison, the financial services sector average is around 13.  These are only projections at this stage. The company may perform better or worse than expected over the next few years. A prolonged economic downturn could cause income to fall significantly, limiting the amount of money the business has available to return to investors. That’s something I will be keeping an eye on.  Nevertheless, I think this is one of the best shares to buy today, considering its valuation and income potential. Investec may face headwinds in the near term, but considering its valuation, I think the risk of investing is worth the potential reward if everything goes right.  Vodafone’s dividend  Vodafone (LSE: VOD) is one of the FTSE 100’s top income stocks. The company has a reputation for paying out most of its income to investors year after year. Based on current dividend projections, the stock will return 6% to investors in the year ahead. The pandemic has shown just how essential telecommunication networks are in times of uncertainty. It has also accelerated the uptake of technologies such as fibre broadband and 5G.  Working from home may become the new normal as we advance, which suggests the demand for these products will remain elevated. That should be good news for companies like Vodafone. That said, the group will face challenges. It is becoming more and more expensive for the company to compete with sector peers, and it has a lot of debt. Both of these factors may hurt profitability, which could limit its ability to meet dividend forecasts.  I will keep these concerns in mind, but in the meantime, I think Vodafone is one of the best shares to buy today for my portfolio based on its dividend credentials.  The high-calibre small-cap stock flying under the City’s radar Adventurous investors like you won’t want to miss out on what could be a truly astonishing opportunity… You see, over the past three years, this AIM-listed company has been quietly powering ahead… rewarding its shareholders with generous share price growth thanks to a carefully orchestrated ‘buy and build’ strategy. And with a first-class management team at the helm, a proven, well-executed business model, plus market-leading positions in high-margin, niche products… our analysts believe there’s still plenty more potential growth in the pipeline. Here’s your chance to discover exactly what has got our Motley Fool UK investment team all hot-under-the-collar about this tiny £350+ million enterprise… inside a specially prepared free investment report. But here’s the really exciting part… right now, we believe many UK investors have quite simply never heard of this company before! Click here to claim your copy of this special investment report — and we’ll tell you the name of this Top Small-Cap Stock… free of charge! More reading 2 of the best UK dividend-paying stocks to buy right now 3 FTSE 100 shares to buy now Vodafone stock looks pricey but I find it’s 6% yield hard to resist 5% dividend yields! 2 UK shares I’d buy now for passive income 2 FTSE 100 shares I’d buy today for passive income Rupert Hargreaves 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 post 3 shares to buy today for income appeared first on The Motley Fool UK.
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  38. Gold falls by Rs 10,000 from its 8-months high: Should you invest now? (25/02/2021 - Financial Express)
    Gold prices fell to their lowest in nearly three months and headed for their worst week since end-November, as recent strength in U.S. Treasury yields dented the non-yielding metal's appeal.
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  39. London Markets: FTSE 100 nears pre-pandemic high, while data show strongest U.K. growth in almost a year (11/06/2021 - Market Watch)
    Resource stocks were driving the FTSE 100 to gains on Friday, lifting the index back toward levels not seen since before the COVID-19 pandemic.
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  40. UK shares to buy now: 2 FTSE 100 stocks I own (10/04/2021 - The Motley Fool UK)
    I own a wide variety of UK shares. However, I’ve recently bought more of my two favourite FTSE 100 stocks, as I believe they’re attractively priced. Here’s why I’m putting more of my money into these businesses.  UK shares to buy now The first company is British American Tobacco (LSE: BATS). Due to the ethical considerations surrounding tobacco, this stock might not be suitable for all investors. Cigarette sales around the world seem to be in terminal decline. Policymakers are doing everything they can to stop consumers smoking as a public health issue. These headwinds could slow British American’s growth in the long run.  Ethical considerations aside, I think this stock is incredibly attractive from an income perspective. Although cigarette consumption has been declining for decades, this hasn’t stopped British American’s growth. The company has used a careful combination of steady price increases and operational efficiency initiatives to improve profit margins and increase profits.  As each cigarette’s production cost is incredibly low compared to the sale price, the company earns fat returns on equity and profit margins. This has allowed management to pay out healthy dividends. For example, last year, the group returned nearly £5bn to investors, or 210p per share. Current estimates suggest the company will pay investors a dividend of 218p per share this year, implying the stock offers a dividend yield of 7.9%. This is just a forecast at this stage.  Unfortunately, due to the risks outlined above, there’s no guarantee this level of income will continue. Still, considering the company’s past performance, I’d buy more of the FTSE 100 business for my portfolio today, considering its income potential. FTSE 100 growth  The second company I’m considering buying more of for my portfolio is Reckitt Benckiser (LSE: RB).  This consumer goods company, which specialises in cleaning products, has made several strategic missteps over the past few years. The biggest of these was the $16.6bn deal to buy Mead Johnson in 2017. The US-headquartered division runs a range of infant formula brands, including Enfamil, Enfapro and Lactum. The deal was supposed to help the company crack the Chinese market for infant formula, but it hasn’t lived up to expectations. As a result, Reckitt’s new management is reported to be looking for buyers for Mead Johnson’s Chinese division.  Reckitt has also attracted criticism for not investing enough in its brands. It’s planning to rectify this with higher levels of investment as we advance.  Put simply, it looks to me as if Reckitt is trying to correct its past issues. That’s why I’d buy more of the stock today.  Of course, the company will face risks and challenges. Even though management is looking to invest more in the group’s product range, that doesn’t mean growth will accelerate overnight. There’s also no guarantee the company won’t make other mistakes. More costly strategic errors could put investors off the business, weighing on the share price. But I’m willing to take those risks on board and add to my investment. There’s a ‘double agent’ hiding in the FTSE… we recommend you buy it! Don’t miss our special stock presentation. It contains details of a UK-listed company our Motley Fool UK analysts are extremely enthusiastic about. They think it’s offering an incredible opportunity to grow your wealth over the long term – at its current price – regardless of what happens in the wider market. That’s why they’re referring to it as the FTSE’s ‘double agent’. Because they believe it’s working both with the market… And against it. To find out why we think you should add it to your portfolio today… Click here to get access to our presentation, and learn how to get the name of this 'double agent'! More reading 2 FTSE 100 stocks I’d buy 2 leading UK shares I would buy today – at last year’s price UK shares to buy now: 3 I think can double my money in 3 years Three 6%+ yielding FTSE 100 UK shares I’d pick today 2 FTSE 100 shares with 8% yields I’d buy for an ISA today Rupert Hargreaves owns shares in British American Tobacco and Reckitt Benckiser. 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 post UK shares to buy now: 2 FTSE 100 stocks I own appeared first on The Motley Fool UK.
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  41. Is the Legal & General share price good value? (28/02/2021 - The Motley Fool UK)
    The Legal & General share price at the time of writing is around 270p per share. Not that much above where it was five years ago. Since 2016, the share price has hit a high of 314p in Feb 2020 and a low of 157p a month later. It has spent quite a bit of time fluctuating either side of 250p. But while that may seem uninspiring, there are reasons to like the shares, in my view.  What to like about the shares I hold these so this one is easy for me. It’s the dividend. Management were brave throughout the pandemic keeping the dividend. It’s clearly a focus for them. The shares currently yield around 6.5% so are up there amongst the highest on the FTSE 100. Yet unlike other high-yielding shares, I don’t see Legal & General facing the same external threats. For example, tobacco shares have a high yield to attract investors because the industry faces massive challenges from public health campaigns, sin taxes and legislation – especially against the next generation products like vaping. Tobacco shares therefore could arguably be seen as a value trap. For me Legal & General is not a value trap. The dividend should be sustainable and needn’t come at the cost of share price growth. But management does need to try and get the shares moving back up. The group is boosting its work around retirement planning and annuities. As we become a greater population this ought to be an area of growth for the business. Greater pension freedoms should also help Legal & General. What’s not so appetising about L&G Paradoxically it may also be the high dividend yield. There’s a chance the payout ratio is too high and is starving the business of cash to invest in growth. All businesses should work hard to stay competitive and that usually involves investment. This may be why over the last five years the share price hasn’t really risen. Investors haven’t been excited by the slow and steady nature of the business.  Given that Legal & General is a financial share and tied to the UK economy in many ways, perhaps it’s unsurprising its share price hasn’t gone anywhere. Rival Aviva has actually fallen over five years, as have bank shares, which also act as a proxy for UK plc. My view on the Legal & General share price Legal & General has a steady business, a strong brand, a good management team and doesn’t face massive external challenges to its business model. It operates in a safe and steady industry, which doesn’t face disruption in the same way many other industries do. Overall I think I’m happy to hold Legal & General shares for the dividend. I think with an economic boost on the horizon from ending lockdowns, perceptions around the share can improve. 5 Stocks For Trying To Build Wealth After 50 Markets around the world are reeling from the coronavirus pandemic… And with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains. But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be daunting prospect during such unprecedented times. Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down… You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm. That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away. Click here to claim your free copy of this special investing report now! More reading FTSE 100 stocks: 3 to watch out for in March 2 cheap UK stocks to buy now 2 blue-chip UK shares I’d pick now for a growing income 2 of the best UK dividend-paying stocks to buy right now 2 FTSE 100 shares I’d buy today to generate a passive income stream Andy Ross owns shares in Legal & General. 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 post Is the Legal & General share price good value? appeared first on The Motley Fool UK.
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  42. The Game Theory: $18T in Negative Yielding Debt (01/04/2021 - Reddit Stock Market)
      submitted by   /u/coinmonks [link]   [comments]
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  43. Why is the FTSE 100 is rising? (12/05/2021 - The Motley Fool UK)
    In mid-April 2021, the FTSE 100 breached the 7,000-point mark for the first time since before the pandemic. Most recently, on Friday 7 May, the index surged to a 15-month high of over 7,100 points. But what exactly is behind the FTSE 100’s recent surge? We have the answers. [top_pitch] What has happened to the FTSE 100 in the last 12 months? Stock markets around the world went into steep decline in the first part of 2020. The FTSE 100 tracks the performance of the 100 biggest companies listed on the London Stock Exchange. It started the year at 7,542 points. The index plunged to below 5,000 points in mid-March as the scale of the Coronavirus pandemic became clear and fears about its impact on the global economy grew. The FTSE 100 made a recovery alongside the economy later in the year after the intervention of the government and the Bank of England. However, the FTSE 100 still managed to clock its worst year on record since the 2008 financial crisis. The FTSE’s total losses in 2020 came to 14.3%. This made it the worst performer among the world’s largest stock indexes. In 2021, though, things are looking up. The index has been rising steadily in the last couple of months. What is causing the FTSE 100 to rise? Various factors have contributed to the FTSE 100’s rise to more than 7,100 points. The biggest factor appears to be greater optimism about the UK’s economic recovery. Over the last few weeks, several financial institutions and economists have expressed that the UK economy is set for its biggest boom since the post-war period. This is on the back of a hugely successful rollout of the Covid-19 vaccine and the anticipated reopening of the country. Indeed, growing optimism about the recovery of the UK economy has prompted British businesses to increase hiring and offer higher pay to new employees, according to Reuters. The impact of a positive economic outlook is an increase in investor confidence. This, in turn, is driving the FTSE 100 higher. As investors become more confident about the prospects of the economy, they are increasingly willing to put their money into riskier assets like stocks and shares. This includes the stocks and shares of FTSE 100 companies, which investors expect to profit from in 2021 as pent-up demand is unleashed into the market once the country reopens fully. [middle_pitch] How high could the FTSE 100 go? That is the big question. The FTSE 100’s all-time high is 7,903.50. It achieved this feat in 2018. We have already seen other stock indexes from around the world, including the S&P 500 and the Nasdaq Composite, recover their pandemic losses to reach new highs in the last few weeks. Could the FTSE also hit a new all-time high in 2021? We’ll have to wait and see on that one. The UK’s economy is not expected to recover to pre-pandemic levels until at least the second quarter of 2022. But if the current recovery trend is sustained, and if there are no major setbacks in regards to the fight against the pandemic, there is no reason why the FTSE 100 should not continue to rise. This is certainly good news for investors. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading FTSE 100 stocks I’d buy as the UK economy powers ahead The Glencore share price is up 10% already this week. What’s going on? The FTSE 100’s Spirax-Sarco share price soars as it expects to beat guidance! Should I buy Airbnb shares now? 3 UK shares to buy today The post Why is the FTSE 100 is rising? appeared first on The Motley Fool UK.
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  44. FTSE 250 stocks: 1 I’d buy in 2021 (12/06/2021 - The Motley Fool UK)
    Many investors concentrate on the FTSE 100 when they’re looking for stocks to buy. However, I believe this is a mistake. Instead, I look in the FTSE 250 for investments. I favour this index over its blue-chip peer because smaller businesses, which make up the FTSE 250, tend to grow faster than their larger peers. Of course, there are many reasons why one business can grow faster than another, but one of the main reasons why smaller companies tend to grow more quickly is the law of large numbers. For example, a company that generates sales of £100bn would have to find an additional £20bn of revenues to grow 20%. By comparison, a corporation with sales of just £200m would only need to increase revenues by £40m to grow 20%.  That said, investing in small businesses might not be suitable for all investors. Smaller companies tend to be riskier than blue-chips. As such, some might feel more comfortable sticking to stocks located in the FTSE 100.  Nevertheless, I’m comfortable with the risks involved with buying FTSE 250 stocks, which is why I’d buy 4Imprint (LSE: FOUR).  FTSE 250 growth stock  4Imprint is a direct marketer of promotional products, such as bags and pens. Companies usually give these out at events, such as conferences or annual general meetings.  As these events have moved online over the past 12 months, 4Imprint’s sales have plunged, but a recovery is now starting to take shape.  According to its latest trading update, total order intake in January and February was running at 65% of 2019 levels. However, the figure increased to 80% of 2019 levels in April. And, in the first few weeks of May, sales rose to 85% of 2019 levels.  This seems to suggest the FTSE 250 group is on track to recover the sales it lost last year at some point in the next two or three months. From there, I believe the business will return to growth, compared to 2019 levels of trade.  4Imprint has a strong balance sheet to support this growth. At the end of April, the company reported a net cash balance of $44m. That was compared to $39.8m at the end of 2020. So not only are the company’s sales recovering, but it looks as if the business is also profitable and generating cash.  Unique opportunity Considering the company’s recovery and growth potential over the next six months, I’d buy the stock for my portfolio today. With its cash-rich solid balance sheet, 4Imprint has the financial headroom to invest in marketing to drive growth and expand into new markets. This could provide an additional tailwind to the group’s organic recovery.  That said, 4Imprint could encounter further turbulence in the months ahead. Another coronavirus wave may force governments to rethink reopening plans. This may reduce demand for its products. There’s also a chance inflation could eat away at the company’s profit margins if it can’t pass higher costs on to buyers.  Still, I’m confident in the FTSE 250 company’s potential. That’s why I’d buy the stock for my portfolio as a recovery play in 2021.  The post FTSE 250 stocks: 1 I’d buy in 2021 appeared first on The Motley Fool UK. One FTSE “Snowball Stock” With Runaway Revenues Looking for new share ideas? Grab this FREE report now. Inside, you discover one FTSE company with a runaway snowball of profits. From 2015-2019… Revenues increased 38.6%. Its net income went up 19.7 times! Since 2012, revenues from regular users have almost DOUBLED The opportunity here really is astounding. In fact, one of its own board members recently snapped up 25,000 shares using their own money… So why sit on the side lines a minute longer? You could have the full details on this company right now. Grab your free report – while it’s online. More reading UK shares: I’m thinking like Warren Buffett to play the new bull market 3 UK dividend stocks yielding 6%+ to buy now 2 top dividend stocks I’d buy more of The FTSE 100 shares I’d buy today with £3,000 These are the 5 top FTSE 100 shares over 5 years. I like 3 today Rupert Hargreaves owns no share mentioned. The Motley Fool UK has recommended 4imprint Group. 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.
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  45. Do the highest-yielding dividend shares offer the best passive incomes? (03/03/2021 - The Motley Fool UK)
    When seeking to make a passive income, many investors may naturally be drawn to the highest-yielding dividend shares. After all, they offer the greatest potential income return on a relative basis. However, it could be prudent to check their dividend affordability before buying them. This doesn’t guarantee they’ll be able to make future dividend payouts, of course. But it can be a means of ruling out stocks that are clearly unable to afford their shareholder payouts. Similarly, assessing the growth potential of a company’s dividend can be a sound move. It may allow an investor to obtain a growing passive income in the long run. Assessing affordability when buying dividend shares The affordability of shareholder payouts can be assessed in a couple of different ways. Dividend shares can be analysed by comparing their net profits with shareholder payouts. A company with a large amount of headroom when making dividend payments may be less likely to run into trouble when trying to pay them in future. Meanwhile, an assessment of a company’s wider financial situation can provide an insight into the affordability of its dividends. For example, considering its debt levels and interest cover, in terms of how many times it could service debt out of operating profit, may build a picture of its financial strength. Similarly, companies that have a long and reliable track record of dividend payouts may be less likely to cut them in future. All of these factors, when combined, can provide an insight into the reliability of dividend shares. It may lead an investor to avoid the highest yielding stocks in favour of more reliable opportunities that have lower yields. Dividend growth opportunities As well as a high and reliable yield, buying dividend shares that can grow shareholder payouts at a fast pace could be a shrewd move. They may be able to deliver a rising passive income over the long run. And that should have more of a positive impact on an investor’s financial situation. Certainly compared to a high initial yield that fails to grow at a fast pace over the coming years. Assessing the prospect of dividend growth is very subjective. It’s closely tied to the financial performance of a business, in terms of how quickly its profitability can grow. Therefore, analysing its strategy, forecasts and competitive advantage could act as a guide, rather than a definitive answer, to the question of its dividend growth potential. Despite the subjective nature of assessing the growth potential of dividend shares, the process can help an investor to avoid potentially unattractive stocks. This doesn’t mean a complete avoidance of companies that may struggle to raise dividends in the coming years. But it could improve an investor’s risk/reward ratio so they’re more likely to enjoy a high and growing passive income in the long run. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading How I’d start investing with just £50 a month in 2021 UK budget 2021: 10 stocks that could rally next Will the Rolls-Royce share price recover in 2021? Traineeships: what they are, and what’s changing UK stock investing: my 2 contrarian picks for 2021 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 post Do the highest-yielding dividend shares offer the best passive incomes? appeared first on The Motley Fool UK.
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  46. This FTSE 100 share is down 60% in 5 years. I like the stock! (26/04/2021 - The Motley Fool UK)
    As an old-school value investor, I often trawl the depths of the FTSE 100 index, looking for bombed-out shares. But, like Warren Buffett, I’m not looking for ‘cigar butt’ businesses with just one puff left in them before they die. Instead, I’m seeking ‘fallen angels’. These are solid businesses, perhaps facing real problems, but whose share prices are out of touch with reality. Ironically, one of these potential fallen angels is actually a leading tobacco company. Imperial Brands: fallen angel? Imperial Brands (LSE: IMB), known in the City of London as ‘Imps’, is the world’s fourth-largest tobacco company. It operates in 12o markets and employs 27,500 people. Its portfolio of cigarette brands includes Davidoff, Gauloises, JPS and West, plus Winston and Kool in the US. Obviously, being in the cigarette/tobacco business makes this FTSE 100 stock a no-no stock for ethical and environmental investors. Furthermore, smoking is on the decline in the developed world, with only one in seven (14.1%) British and American adults being regular smokers. But smoking is addictive, which is why customers remain loyal to certain brands. Also, smoking is still highly prevalent in developing countries, with China being the #1 market. And, much to my regret, I have been a cigarette smoker for almost 35 years. That’s why this FTSE 100 firm catches my eye. The IMB share price goes up in smoke Based in Bristol, England, Imperial has been around for 120 years. It makes cigarettes and tobacco products in 38 factories worldwide, selling 330bn cigarettes a year in more than 160 countries. But this FTSE 100 share has crashed since 2016. In September 2016, the Imperial brands share price topped out at 4,130p. It then went into steep decline over the next two years, closing 2019 at just 1,869p. Despite selling a consumer staple, the Imps share price collapsed with the rest of the FTSE 100 in ‘Meltdown March’. On 23 March 2020, IMB closed at 1,276.4p, down nearly seven-tenths (69.1%) from its 2016 high. This FTSE 100 share is down 60% in five years On Friday, the Imperial Brands share price closed at 1,486.5p, down almost three-fifths (59.1%) over the past five years. This makes IMB the second-worst performer of 97 stocks in the FTSE 100 for the full half-decade. Despite this huge decline, Imps still has a market value above £14bn. What would convince me to buy this FTSE 100 stock today? The first attraction is a price-to-earnings ratio of 9.4 and an earnings yield of 10.6%. Imperial also generates huge cash flows, allowing it to pay massive quarterly cash dividends. Right now, IMB has a dividend yield of 9.26% a year, which translates into a quarterly passive income of 2.32%. This makes Imps one of the top-three dividend payers in the entire Footsie. And this income would be completely tax-free inside an ISA. Of course, there are lots of reasons not to buy into this FTSE 100 stalwart. Its products are harmful to health and kill some users. Tobacco smoking is in long-term decline, especially where cannabis is legal. Also, Imperial’s net debt easily exceeds its market value (but it does have a solid credit rating). Yet as an income investor, I like the stock. That’s why I’d buy while the Imperial Brands share price languishes at current levels. CEO’s £500,000,000 Stake on Industry’s “Uber” Revolution We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign. But with this opportunity it could get even better. Still only 55 years old, he sees the chance for a new “Uber-style” technology. And this is not a tiny tech startup full of empty promises. This extraordinary company is already one of the largest in its industry. Last year, revenues hit a whopping £1.132 billion. The board recently announced a 10% dividend hike. And it has been a superb Motley Fool income pick for 9 years running! But even so, we believe there could still be huge upside ahead. Clearly, this company’s founder and CEO agrees. Learn how you can grab this ‘Top Income Stock’ Report now More reading 9% dividend yields! Should I buy this FTSE 100 share for my Stocks and Shares ISA? British American Tobacco and Imperial Brands: which one would I buy? The British American Tobacco share price slumps! Should I buy the stock? Why Imperial Brands’ share price is too cheap for me to ignore Why I’d pick the FTSE 100’s 2 highest yielding shares Cliffdarcy has no position in any of the shares mentioned. The Motley Fool UK has recommended 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. The post This FTSE 100 share is down 60% in 5 years. I like the stock! appeared first on The Motley Fool UK.
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  47. Should I buy this 6%+ yielding oil stock instead of BP or Shell? (13/02/2021 - The Motley Fool UK)
    When Royal Dutch Shell cut its dividend by 65% last year, it was the first time the FTSE 100 oil stock had reduced its payout since World War II. Shareholders (including me) got a rude awakening. Shell’s dividend wasn’t safe, after all. It was a similar story at rival BP. CEO Bernard Looney held on a little longer. But by August, BP’s payout had also been chopped. The only big European oil stock that has held onto its high yield is Paris-based Total (LSE: TTA), whose shares currently yield around 6.5%. Should I sell my Shell shares and buy Total for a higher yield? It’s a change I’m considering. As I’ll explain. The renewable question One problem facing investors in oil stocks is that environmental concerns suddenly became more urgent last year. Institutional investors are now taking an increasingly dim view of big polluters. Shell, BP, and Total have all now made significant commitments to cut their carbon emissions. All three plan to become integrated energy companies, rather than oil and gas producers. They’re all increasing their investment in renewable energy. For example, Total recently invested €2.5bn in Indian renewable group Adani Green Energy. BP has been bidding for new UK offshore wind farm licences. Shell recently bought the UK’s largest electric vehicle charging network, Ubitricity. It also owns a UK electricity supplier. I think the commitment being shown by each company is real. But I also think it’s far too soon to know how successful they’ll be. After all, they’re competing against more experienced renewable operators and established electricity producers. Why I might swap Shell for Total The dividend cuts at BP and Shell weren’t a complete surprise to me. Although I hoped Shell’s payout would be safe, I could see good reasons why both companies needed to cut. On balance, I think it was the right decision. The problem I have now is that Shell’s high dividend yield was my main reason for holding the stock. Although new buyers today can hope for a reasonable 4% yield from this oil stock, my purchase price was much higher than today’s share price. That means the yield on my Shell shareholding has fallen to under 2.5%, from more than 6% previously. By contrast, Total has just confirmed its policy of “supporting the dividend through economic cycles.” The payout for 2020 was held almost unchanged at €2.64 per share, compared to €2.68 in 2019. If Total’s dividend is left unchanged in 2021, then the shares offer a 6.5% yield at current levels. That’s nearly three times the yield I expect from my Shell shares this year. Which oil stock should I own? Should I sell Shell and buy Total? I haven’t decided yet. The problem is that I don’t want to overpay for shares in a sector that faces a lot of uncertainty. Although Total’s dividend yield attracts me, its shares already trade on 14 times 2021 forecast earnings. By contrast, Shell stock trades on just nine times 2021 forecast earnings. I know Shell quite well and believe the firm’s performance is likely to improve this year. I’m less familiar with Total. But the firm’s higher valuation suggests to me there’s more room for disappointment if difficulties arise. I haven’t made a final decision yet. But if I was buying an oil stock today for a new portfolio, I’d consider Total. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading Top income stocks for February 2021 The oil price has recovered from Covid-19 but Shell’s share price hasn’t. What’s going on? Royal Dutch Shell vs the BP share price: which is right for me? Cheap UK share: 1 FTSE 100 stock I can buy and hold till 2025 Royal Dutch Shell shares are falling today. Here’s what I’d do next Roland Head owns shares of Royal Dutch Shell B. 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 post Should I buy this 6%+ yielding oil stock instead of BP or Shell? appeared first on The Motley Fool UK.
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  48. 6% dividend yields! A UK income share I’d buy from the FTSE 100 today (18/02/2021 - The Motley Fool UK)
    I believe electricity grid operator National Grid (LSE: NG) is an exceptional UK dividend share to buy today. 2020 was a bloodbath for income hunters as Covid-19 caused hundreds of British companies to cut or cancel dividend payments. But this FTSE 100 company was still able to keep hiking its own dividends, a testament to its ultra-defensive operations. These very same non-cyclical operations mean that National Grid remains a top dividend share as concerns over the economic recovery linger, in my opinion. These types of UK shares aren’t without their share of risk however. The threat of punishing regulatory action is always in the background. In fact, Ofgem recently called for a new independent body to take over the running of Britain’s electricity system from National Grid. There’s also the problem of high costs to contend with. This isn’t just because it’s mightily expensive to keep the power grid operational in the UK and in its US territories. As we’ve seen this week, extreme weather patterns in the States are becoming an increasingly regular problem. And this is hitting National Grid hard in the pocket. Dividends tipped to keep rising There’s never any guarantee that broker forecasts will hit the mark. Estimates can come in better or worse than expected, depending on trading conditions. But City analysts expect National Grid’s dividends to keep growing over the next few years, at least. This is even though annual earnings are predicted to dip in the short term. A 6% decline is predicted for this fiscal year to March. It’s because those analysts predict earnings at the FTSE 100 company will rise over the following couple of years. Increases of 14% and 7% are anticipated for financial 2022 and 2023 respectively. A top UK dividend share UK shares like this are famed for their ability to grow annual profits over the long term. It’s a quality that’s enabled the power grid operator to raise annual dividends consistently for almost a decade. And, as I say, analysts reckon National Grid will have the balance sheet strength to keep raising shareholder payouts. That’s despite the predicted profits blip for this year. The company raised around £3.5bn of long-term financing this year to shore up its fiscal position. City brokers aren’t perturbed by the fact predicted dividends are barely covered by expected earnings over the next few years. Dividend coverage of 1.1 times to 1.2 times sits well below the widely-regarded safety benchmark of 2 times. Dividend cover is a popular way to gauge a UK share’s ability to pay dividends to its investors. A total dividend of 49.5p per share is predicted for this year, up from 48.57p last time out. Payouts are expected to move to 50.45p and 51.54p per share in fiscal 2022 and 2023. And this means National Grid’s huge 5.8% dividend yield for this year marches to 5.9% for 2022, and 6% for the following year. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading Top income stocks for February 2021 This FTSE 100 stock yields over 5%, making it a great passive income opportunity! 6% dividend yields! A UK share I’d buy in February and hold for 10 years High dividend stocks: why I’d buy these 3 FTSE 100 shares yielding up to 8% The National Grid share price is down: should I buy it for my Stocks and Shares ISA? 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 post 6% dividend yields! A UK income share I’d buy from the FTSE 100 today appeared first on The Motley Fool UK.
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  49. 2 stocks and shares for a passive income (11/06/2021 - The Motley Fool UK)
    I believe investing in stocks and shares is one of the best ways to earn a passive income. However, this strategy might not be suitable for all investors.  If a corporation’s profits suddenly slump, management may have no choice but to cut the dividend. This, unfortunately, happened to many firms last year.  Still, I’m comfortable with the level of risk involved in buying stocks and shares for a passive income. And with that in mind, here are two income stocks I’d buy today.  Stocks and shares The first company on my list is financial services enterprise CMC Markets (LSE: CMCX). The group’s profits have exploded over the past year as it’s benefited from an influx of customers. The number of clients trading CFDs on its platform rose 34% in its financial year ending 31st March. Meanwhile, the number of stockbroking clients increased by 28%.  Overall profit increased 127% to £224m year-on-year. Off the back of these results, management hiked the company’s ordinary dividend for the year by 104% to 30.6p, from 15p last year. These numbers suggest the stock offers a yield of 6.3%, at current levels.  Based on these numbers, I’d buy CMC for my passive income portfolio of stocks and shares.  However, while the company benefited from an explosion in business last year, it may not last. Clients may spend less time on CMC’s platforms as the economy reopens and lockdowns are eased. This may lead to reduced trading activity and, as a result, profits.  If profits do decline, CMC may reduce its dividend next year.  Passive income Alongside CMC, I’d also buy the oil giant BP (LSE: BP) for my passive income portfolio of stocks and shares. Last year, the company announced one of the most considerable losses in British corporate history as falling oil and gas prices inflicted pain on its portfolio. That led to a 50% cut in the group’s dividend as management pulled out all the stops to conserve cash.  BP’s fortunes have improved dramatically over the past six months. It reported underlying first quarter profit of $2.6bn, up from $791m a year ago. What’s more, strong underlying free cash flow and asset sales have cut $18.1bn off net debt in 12 months. In my opinion, these figures suggest management has stabilised the business, which should support the company’s dividend. At the time of writing, the stock supports a dividend yield of 6.2%. That’s why I’d buy the stock for my passive income portfolio.  Unfortunately, the company faces some unique risks not applicable to other stocks and shares. The global transition away from oil and gas towards renewable energy threatens its existence. While BP is planning to spend more over the next few years on renewable projects, this might not be enough.  As such, the stock may not be suitable for all income investors. The post 2 stocks and shares for a passive income appeared first on The Motley Fool UK. The Motley Fool UK's Top Income Stock… We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign. But with this opportunity it could get even better. Still only 55 years old, he sees the chance for a new “Uber-style” technology. And this is not a tiny tech startup full of empty promises. This extraordinary company is already one of the largest in its industry. Last year, revenues hit a whopping £1.132 billion. The board recently announced a 10% dividend hike. And it has been a superb Motley Fool income pick for 9 years running! But even so, we believe there could still be huge upside ahead. Clearly, this company’s founder and CEO agrees. Learn how you can grab this ‘Top Income Stock’ Report now More reading 3 high-yielding FTSE 250 shares What am I doing with my BP shares? Could BP shares be the investment of the decade for me? My top FTSE 100 stocks to buy in June 3 high-profile UK shares I’m avoiding Rupert Hargreaves 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.
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