The FTSE 100 (FTSEINDICES: ^FTSE) has perked up a little today as it seems likely there will be at least a temporary truce called in the US budget battle. The index gained 28 points in early trading to reach 6,462, which is actually eight points up on the week.
Investors started selling a week ago in response to the deadlock, but it was clear even than that the problem would be solved sooner or later and that stock markets would go up again as a result, so it does raise the question of why they bother.
One way Foolish investors can ignore such nonsense is to look for good dividends. Here are three FTSE members who lifted theirs this week:
Direct Line Insurance
On Tuesday we heard of a special dividend from Direct Line Insurance Group (LSE: DLG), after the firm announced plans to dispose of its life insurance business to Chesnara for a total of £62m. That includes a pre-closing dividend of £23m, and should result in an accounting gain of around £12m.
The proceeds will be returned to shareholders as a one-off special dividend of 4p per share, representing 1.9% of the current 210p share price.
There was a 4.2p-per-share interim dividend paid at the halfway stage this year. If last year’s final payment of 8p is repeated, we’ll be looking at a total of 12.2p per share for a yield of 5.8% on today’s price.
N Brown
Home-shopping firm N Brown Group (LSE: BWNG) released first-half results on Wednesday, and raised its interim dividend by 4% to 5.67p per share, although adjusted earnings per share (EPS) came in less than 1% ahead.
There’s a new chief executive on board in the person of Angela Spindler who talked of “significant opportunity for growth“, and the second half is apparently off to a strong start.
Analysts are currently forecasting a 6% rise in the total dividend. With the shares currently at 488p that would provide a 2.8% yield, just a little below the FTSE’s long-term average of around 3%.
WH Smith
WH Smith (LSE: SMWH) is our third big payer this week, after the high-street name lifted its final payment by 15% to 21.3p per share on Thursday. On top of an earlier first-half payment, that amounts to a total of 30.7p for a 14% rise. The increase was made possible by a 15% gain in EPS to 68.5p, after both the firm’s Travel and High Street divisions saw profits rise.
The shares have done very well over the past 12 months, gaining nearly 30% to 883p. On that, this year’s dividend represents 3.5%, so shareholders should be happy.
The dividend was slightly ahead of the analysts’ consensus, and they have a further 9% rise penciled in for next year, which would provide an attractive 3.9%.
