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Beaten down dividend paying shares that could be good for the long term

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Anyone buying PV Crystalox Solar? - I think I read it was coming out of the FTSE250. Currently has a yield of 10% with good dividend cover.

 

http://www.iii.co.uk/investment/detail?cod...ntals&it=le

 

There's a thread on it here.

 

http://www.greenenergyinvestors.com/index....mp;#entry148655

 

I just get the impression that it is unloved right now as is the solar sector, which may be a bit of a surprise given that green seems to be the in thing. PV's P/E is around 2.5, so either the market knows something or this one is a bargain currently selling at depression level fundamentals. The techinical side didn't look too good either.

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Beware this comes from David Stephenson LOL

 

Four long-term dividend payers to buy now

 

Four solid dividend payers to buy now

 

So what are the FTSE 100’s best-yielding progressive dividend payers of the last 10 years? (Just be aware, I’ve excluded special dividends and returns of capital).

 

The name at the top of my list is, perhaps surprisingly, a financial stock. ICAP (LSE: ICAP) is the world’s premier inter-dealer broker across markets from shares to shipping. ICAP has upped its payout by a compound 23% since 2000. Yet at 450p the historic yield is almost 3.9%. Analysts now see dividend increases slowing, yet the prospective yield is still around 4%.

 

Next comes Britain’s biggest utility Centrica (LSE: CNA). This has lifted dividends by 18.5% compound over the period. At 277p, Centrica’s historic yield is 4.5%, while shareholders can expect a 4.7% prospective return.

 

We’ve been tipping tobacco stock BAT (LSE: BATS) for several months. This has grown dividends by almost 15% a year since 2000. Yet at 2,033p it still yields 4.4% historically, with over 5% in prospect.

 

Power provider Scottish & Southern Energy (LSE: SSE) is another of our favoured ‘defensive’ stocks. This has seen 10% yearly payout increases over the period. Last year’s yield was 5.8%, which is forecast to rise to 6.1% during the next 12 months.

 

And one to watch

 

Publisher Reed Elsevier (LSE: REL) has boosted dividends by 8.5% over the last decade. At 501p, Reed’s historic yield is 4.1%. Analysts aren’t sure the dividend will be nudged up this year, so it could pay to put this one on the watch list. But the company appears to be selling off some of its loss-making US titles, which bodes well for the future.

 

Just to emphasise, this isn’t really about the short-term relative merits of the individual stocks, but about finding a rising long-term income. What’s interesting about these particular firms is that even though they have steadily grown their payouts, they’ve mostly fallen out of favour with the market recently. That’s why they are relatively high-yielding compared to the market – their dividends have grown faster than their share prices.

 

But that’s great news for long-term investors. One of the best times to snap these sorts of stocks up is when most investors are looking the other way. When such stocks return to fashion, you’re already safely on board, ready to cash in.

 

And there will be some juicy dividend payouts on offer very soon. BATS, for example, has a chunky final dividend on the way. We’ll get full details on 25th February, but the analyst consensus is for a payment of just over 71p per share, equal to a yield of 3.5% by itself. But you’d need to buy BAT shares before 10th March to collect this.

 

By the way, if you’re specifically interested in generating an income from your share portfolio, you should be reading Stephen Bland’s Dividend Letter newsletter. Stephen’s strategy is all about finding solid dividend payers to generate a long-term income. If you’re tempted by any of the shares I’ve mentioned above, then you’ll find Stephen’s views very interesting.

 

http://www.moneyweek.com/investment-advice...Money%2BMorning

 

 

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Catflap's warning

 

Be careful buying stocks to hold for a 4% or 5% dividend because this cyclical bull market should peak by August/September 2010 time and then go into another much longer bear market. If the div ex-date is after this time frame then it might be better to sell near the market peak and lock-in capital gains since falls from the peak could/should be bigger than the dividend payout.

 

That said - high yielders will cushion falls when dividends get reinvested so should do better than shares that pay no dividend. But a bear market is a bear market and it's no fun to see your portfolio going down in value wishing you had sold at the top!

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The dividend payers are looking better value after the recent market falls.

 

From Digital Look, FTSE100, all with yield of 5%+. I think I would ignore banks and property.

 

Lloyds Banking Group 10.94%

Man Group 10.36%

Land Securities Group 8.55%

Aviva 8.34%

British Land Co 7.74%

Hammerson 7.17%

Rexam 6.22%

United Utilities Group 6.14%

RSA Insurance Group 5.98%

Severn Trent 5.90%

Standard Life 5.90%

Cable & Wireless 5.86%

Home Retail Group 5.78%

Vodafone Group 5.76%

Royal Dutch Shell 'B' 5.71%

BP 5.66%

Scottish & Southern Energy 5.62%

National Grid 5.55%

Royal Dutch Shell 'A' 5.51%

HSBC Holdings 5.13%

Legal & General Group 5.08%

Marks & Spencer Group 5.05%

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I was also having a flick through digital look after listening to financial sense talking about "buying the essentials", a few outside the FTSE 100 which caught my eye were:

 

Drax Group 417.00p 10.38%

Rwe Ag St O.N. € 65.65 6.85%

Pfizer Inc. $19.05 6.82%

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202 companies cut payments last year, 179 increased. Overall figure was a 15% cut.

 

"The top dividend payers in 2009 were BP, Royal Dutch Shell, HSBC, Vodafone and GlaxoSmithKline. These five companies made up 47pc of all payments. In 2007, the companies made 35pc of the total."

Wow!

 

 

http://www.telegraph.co.uk/finance/markets...ds-by-10bn.html

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202 companies cut payments last year, 179 increased. Overall figure was a 15% cut.

 

"The top dividend payers in 2009 were BP, Royal Dutch Shell, HSBC, Vodafone and GlaxoSmithKline. These five companies made up 47pc of all payments. In 2007, the companies made 35pc of the total."

Wow!

 

 

http://www.telegraph.co.uk/finance/markets...ds-by-10bn.html

 

Considering the times we are are living in it is impressive that 179 companies actually increased their dividend. Given that lines of credit were effectively cut off from these companies, including many profitable ones that would have had no problems meeting their debt obligations, I think that overall these figures are not that bad. You also have to take into account that the big dividend loss in the FTSE 100 have been the banks and that is why BP, Royal Dutch Shell, HSBC, Vodafone and GlaxoSmithKline now rule the roost. Again, no surprise there.

 

As a sidenote, this morning's dividend announcements cheered up the market a little.

 

Randgold Resources hiked its dividend by 30% after profits soared in the fourth quarter. The Africa-focused gold miner lifted profit in the three months to December to ฃ38.7m from ฃ9.3m.

 

Miner Xstrata is to resume dividend payments despite earnings sliding last year after heavy one-off costs and weak commodity prices. Net profits in 2009 fell to $661m from $3.66bn after one-off charges nearly doubled to $2.1bn. On an underlying basis earnings fell to $2.77bn from $4.7bn while revenue dipped 16% to $23.5bn.

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I bought BP this morning

 

569 including fees.

 

I've been waiting many years to buy this share at 420 (ish). I think it's time to accept BP is not going to drop that low any time soon

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I have been out of shares fully for about a month or so now (and shorting dow in between), but when the dust settles I'll be back in with Shell, BP, Xstrata and Nat Grid.

 

They all served me well over the past year or so.

 

Bit worried about BP until the leak is stopped though.

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The song remains the same!

 

I piled more into Aviva, BP, GSK, UU and Drax. Intend to hold indefinitely. All decent yields and have solid defensive properties.

 

I just don't understand why Aviva is so cheap. It has low exposure to PIGS debt. Might be a bit of a market overreaction to adopting MCEV standards, but then the entire insurance sector is in the doldrums. It doesn't make sense to me and I reckon this one's gonna be a great cash cow .

 

 

I decided that the only time to worry about BP is if the Americans decide to give up using oil. To be fair, it might be worth waiting and watching - the market overreaction (IMNSHO) seems to be continuing. If it does I'll just buy more: Classic crisis play stuff. They also account in dollars which may provide a buffer against sterling tanking.

 

Bought GlaxoSmithKline on a dip. Classic defensive stock and yielding very highly for a pharmaceutical. Also accounts in dollars.

 

Bought loadsa United Utilities a while back. Classic defensive stock.

 

Drax is a bit of a punt but I figure that it's a long-term keeper. Very high yield and will become more competitive as gas prices rise (which they surely must soon.. I reckon). UK is, by all accounts, lacking in generating infrastructure and facing blackouts thanks to NuLabour's inability to plan for the future.

 

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The song remains the same!

 

I piled more into Aviva, BP, GSK, UU and Drax. Intend to hold indefinitely. All decent yields and have solid defensive properties.

 

I just don't understand why Aviva is so cheap. It has low exposure to PIGS debt. Might be a bit of a market overreaction to adopting MCEV standards, but then the entire insurance sector is in the doldrums. It doesn't make sense to me and I reckon this one's gonna be a great cash cow .

 

 

I decided that the only time to worry about BP is if the Americans decide to give up using oil. To be fair, it might be worth waiting and watching - the market overreaction (IMNSHO) seems to be continuing. If it does I'll just buy more: Classic crisis play stuff. They also account in dollars which may provide a buffer against sterling tanking.

 

Bought GlaxoSmithKline on a dip. Classic defensive stock and yielding very highly for a pharmaceutical. Also accounts in dollars.

 

Bought loadsa United Utilities a while back. Classic defensive stock.

 

Drax is a bit of a punt but I figure that it's a long-term keeper. Very high yield and will become more competitive as gas prices rise (which they surely must soon.. I reckon). UK is, by all accounts, lacking in generating infrastructure and facing blackouts thanks to NuLabour's inability to plan for the future.

 

 

Similar buys to me, I bought Drax for the same reason, my gf works for one of the other coal fired powerstations round here and she says work is dead whilst the gas price is so cheap, Drax is going to be a key part of the UK's energy future, I would of thought at current price it may be a take over target for someone like EDF or EON?

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Similar buys to me, I bought Drax for the same reason, my gf works for one of the other coal fired powerstations round here and she says work is dead whilst the gas price is so cheap, Drax is going to be a key part of the UK's energy future, I would of thought at current price it may be a take over target for someone like EDF or EON?

Hasn't the Drax station gone past it's design life already?

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I read an article recently on the UK's energy crunch which suggested we don't have any choice but to continue its usage, cant seem to find it now, found this which suggests any regulations targeted at coal power stations have been delayed

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I read an article recently on the UK's energy crunch which suggested we don't have any choice but to continue its usage, cant seem to find it now, found this which suggests any regulations targeted at coal power stations have been delayed

We've got to keep using it BUT it's going to need heavy maintenace now that the design life of the components has expired (excepting over design)

 

Also, anyone who owns it has to pay for it to be decommissioned and demolished. There's no problem if Drax have spent the last 30 years saving up. SOmehow, I doubt Drax have saved up for the final stages of life.

 

Do Drax have any other assets (bar the Drax station)?

 

(my spell checker isn't working)

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We've got to keep using it BUT it's going to need heavy maintenace now that the design life of the components has expired (excepting over design)

 

Also, anyone who owns it has to pay for it to be decommissioned and demolished. There's no problem if Drax have spent the last 30 years saving up. SOmehow, I doubt Drax have saved up for the final stages of life.

 

Do Drax have any other assets (bar the Drax station)?

 

(my spell checker isn't working)

http://en.wikipedia.org/wiki/Drax_Group

 

http://en.wikipedia.org/wiki/Drax_power_station

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Just an idea but have been thinking about this co for a little while now. TLPR Comes under the financial sector but these inter dealers seem to benefit from volatility and business performance doesnt mind falling share prices - although its share goes up n down with the market like all the rest. Cash flow a bit down last year mind but still very useful. Now debt free/minimal debt once current cash is accounted for.

 

http://www.telegraph.co.uk/finance/markets...ndervalued.html

 

Inter-dealer broker Tullet Prebon saw its shares crash last week after the company said takeover talks had ended. Questor feels the falls have been overdone and now is a good opportunity to buy.

 

The shares slumped 13pc on Thursday after news broke that there would be no takeover. Also, in the accompanying trading update, Tullett said its revenues had fallen 12pc to £312m in the first four months of 2010 compared with the same period a year ago. However, it argued that business continued to be "robust" and management expects to have a better second quarter.

 

This fall in revenue is not unexpected. The unprecedented volatility seen in the markets a year ago provided strong demand for its services – and the outcome is in line with City expectations. The company also lost a number of senior brokers to a rival, which has obviously hit the top line. Analysts are expecting a 13pc fall in earnings this year.

 

About 6 percentage points of the revenue fall so far this year was down to the poaching of its staff by rival BGC Partners. However, Tullett says that the outlook for the year as a whole should improve as its is actively replacing the brokers who left.

 

Damages from the victory in the poaching case against BGC in London will take another year or so to sort out – so the company can also expect what one broker has referred to as a "modest windfall" over the medium term.

 

"Legal action continues to

be pursued against BGC and former employees in the US

and against former employees

in Hong Kong who have unlawfully terminated their employment with the company in order to join BGC," Tullett said.

 

There are also some regulatory risks on both sides of the Atlantic as the fall-out from the credit crunch continues.

 

However, Questor feels these risks have been overplayed and the current earning multiple for this company is derisory. In fact, it appears to be pricing in Armageddon for the industry – which is highly unlikely. Rival ICAP also faces the same issues, but it is trading on a significantly higher rating.

 

Tullett shares are trading on a December 2010 earnings multiple of just 7.2 times, falling to 6.8 in 2012. ICAP shares are trading on a March 2011 earnings multiple of 11.6 times. If Tullett shares were trading on the same multiple as ICAP they would be valued at 530p a share, some 70pc above the current share price.

 

The down side should be limited because the current valuation is supported by the yield, which currently stands at a worthwhile 4.9pc.

 

Questor thinks that too much risk has been priced into the shares and they are a new buy in the portfolio.

 

flashy website

http://www.tullettprebon.com/investor/investor_reports.aspx

 

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It would be interesting to get your view on them if you ever do get the time to look at their accounts.

 

I did learn the hard way not to short insurance related companies when the market is going up, because they tend to mirror the move. Probably not all of them, but the one I shorted, Old Mutual, did. Fortunately I got out quick.

 

Meant to mention did look at their accounts earlier this year. Trouble is Insurance Co accounts are very much like the Bank ones - opaque - you either believe them or you dont :lol: OK but seriously a lot depends on accurate reserving - even if most Gen Insce type policies are written for 12 months a lot of the more expensive liability claims take longer to resolve, some are not even reported until after the policy has expired.

 

Gen Insurers are also underwriting the unknown future costs of the impacts of health and safety legistlation on employers - until recently businesses had to store a copy of their Certificate of Employers Liabilty Insurance for 10 years (ouch my aching back etc) - still recommended ! Is an example of a known unknown to quote the awful American.

 

I still think Aviva are OK. Might prefer Tullett right now however.

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National Grid rights issue.

 

I've got my shares in a SIPP - will I be offered the new shares?

 

http://uk.finance.yahoo.com/news/national-...d17b56c338.html

 

LONDON (Reuters) - National Grid (LSE: NG.L - news) said it was raising 3.2 billion pounds in a rights issue to fund a sharp increase in investment as Britain looks to meet tough environmental targets and keep the lights on.

 

The gas and electricity transmission network operator said on Thursday it would issue 990 million shares in a 2-for-5 rights issue at 335 pence, a 46 percent discount to Wednesday's close.

 

The news had knocked shares in the group down 6.7 percent to 578.5 pence by 8:16 a.m., making National Grid the top blue-chip faller.

 

...

 

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Got the answer - Yes, I can take up the shares.

 

http://www.h-l.co.uk/__data/assets/pdf_fil...IPP-TCs-kfs.pdf

17. Corporate Actions - In the event of a corporate action in relation

to stock held in Your SIPP We will make every effort to notify You in

order to obtain Your instructions. However, We cannot be held

responsible for any losses resulting from notification failing to reach

You.

Where We do not receive instructions from You by the relevant

deadline We will act in accordance with the following default

instruction: Instalment Payment - Sell enough stock to raise funds to

pay the instalment on the remaining stock. Exercise of warrants - Take

no action. Conversion - Take no action. Open offer - Take no action.

Takeover - Take no action. Scheme of Arrangement - Take no action.

Redemption - Take no action. Rights issue - Lapse stock and allocate

any lapsed rights premium where available.

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