3 More FTSE Dividends Lifted This Week
Feb 28th 2013 12:53PM
Updated Feb 28th 2013 1:55PM
LONDON -- The FTSE 100 regained 0.55% today to reach 6,361, and the U.K.'s top tier index is now 26 points up on the week despite Tuesday's 85-point slump in response to the deadlocked Italian election.
But many investors don't pay much attention to share prices, instead preferring to look for income to beat the average FTSE dividend of about 3%. Here are three companies that raised their annual payouts this week.
Bovis Homes Group kicked off the week with an 80% boost to its full-year dividend to 9 pence per share. With the shares currently trading at 643.5 pence, that's a yield of only 1.4%, but because dividends were scrapped in the crunch year of 2009, they've been gradually coming back as the whole sector recovers.
If current forecasts prove accurate, we should see the Bovis dividend increase by more than 30% for 2013, with the shares on a forward price-to-earnings ratio of just less than 17 -- though current 2014 forecasts drop that to 13.
On Tuesday, consumer credit firm Provident Financial raised its full-year dividend by 12% to 77.2 pence per share, giving a yield of 5.3% on the current 1,467 pence share price. Perhaps surprisingly, after results that also included an earnings-per-share rise of 13.8% to 102 pence, the shares fell on the day by 56 pence to 1,468 pence.
The 2012 dividend was covered 1.32 times by earnings, and analysts are currently forecasting a further 8% rise in Provident's annual payout for 2013, with a 7.6% rise to follow in 2014.
Engineering services firm Weir Group lifted its full-year dividend by 15% to 38 pence per share on Wednesday. That's a modest yield of 1.6% based on today's share price of 2,353 pence, but it does represent the latest in a series of year-on-year dividend increases from the company, and it was covered nearly fourfold by earnings. And there should be more to come after chief executive Keith Cochrane told us that "alongside substantially higher cash generation, the Group plans the eighth consecutive year of double digit dividend growth" in 2013.
Dividend rises like these three are always welcome, and companies that manage steady payouts form the cornerstones of many a portfolio. Whether you're investing for income or growth, good old cash is always welcome. And that's why I recommend the brand-new Fool report "The Motley Fool's Top Income Share For 2013," in which our top analysts identify a share they believe will provide handsome dividend income for years to come. But it will only be available for a limited period, so click here to get your copy today.
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