4 Dividends Too Good To Miss! Vodafone Group plc, Royal Mail PLC, Carillion plc & Legal & General Group Plc

Royston Wild takes a look at dividend darlings Vodafone Group plc (LON: VOD), Royal Mail PLC (LON: RMG), Carillion plc (LON: CLLN) and Legal & General Group Plc (LON: LGEN).

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Today I am running the rule over four top-tier dividend picks.

A brilliant package

With online shopping activity continuing to explode, I believe the ground is laid for Royal Mail (LSE: RMG) to enjoy strong profits growth in the years ahead.

More than a fifth of all British spending is now conducted online, the British Retail Consortium noted this month, with Internet sales leaping 10.7% year-on-year in February. But this phenomenon is not just being witnessed in the UK, which is a great sign for Royal Mail’s GLS division in Europe.

With restructuring also bolstering the bottom line, Royal Mail is anticipated to raise an estimated dividend of 21.8p per share for the year to March 2016, to 22.9p in 2017 and 24.1p the following year. These latter figures create terrific yields of 4.8% and 5.1% respectively.

Build a fortune

I believe that Carillion (LSE: CLLN) is also a robust selection for dividend hunters thanks to the strength of the domestic construction sector.

Much has been made of British construction PMI hitting a ten-month low in February. But a figure of 55 still illustrates strong growth. Meanwhile, investors should be encouraged by Carillion’s ability to keep delivering massive contract wins with both public- and private-sector clients.

The City expects Carillion to shell out a dividend of 18.9p per share in 2016, yielding a market-bashing 6.5%. And the yield leaps to 6.7% next year thanks to predictions of a 19.5p dividend.

Business is booming

I believe that Legal & General (LSE: LGEN) is one of the hottest picks out there for both growth and income chasers, as demand for insurance products explodes across the globe.

Legal & General has proved extremely adept at responding to changing social and regulatory trends across the globe, and is proving increasingly successful in the hot growth regions of Asia. Meanwhile exploding cash flows are also a terrific omen for dividend investors.

For 2016 Legal & General is expected to pay a dividend of 14.3p per share, and this rises to a projected 15.5p for next year. Consequently the company carries exceptional yields of 6.2% and 6.7% for this year and next.

A telecoms treat

Concerns continue to hang over the near-term dividend outlook for telecoms giant Vodafone (LSE: VOD).

Improving trading conditions in the company’s core European marketplace — combined with surging demand from new customers across Africa, Asia and the Middle East — are helping to power group services revenues higher.

But the colossal cost of Vodafone’s Project Spring organic investment scheme, allied with its busy M&A strategy, is casting concern over whether the firm can keep its progressive dividend policy rolling.

Indeed, the City expects Vodafone to lift a payout of 11.22p per share in the year to March 2015 to 11.5p in the current period, and keep it at this level until 2017.

Still, this figure still yields an enormous 5.2%. And the fruits of Vodafone’s huge investment drive is expected to get dividends chugging again from 2018 as earnings surge — an 11.7p reward is chalked in for the year after next, nudging the yield to an even-better 5.3%.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Royston Wild has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Young mixed-race woman jumping for joy in a park with confetti falling around her
Investing Articles

If I’d invested £5,000 in a Nasdaq index fund 5 years ago, here’s how much I’d have now

The Nasdaq index keeps hitting new all-time records in 2024, as US tech stocks fly. How much could I have…

Read more »

A senior group of friends enjoying rowing on the River Derwent
Investing Articles

£500 to invest a month? Consider aiming to turn that into a £20,000 passive income like this!

With a regular monthly investment, it's possible to build a large and steady passive income for retirement. Royston Wild explains.

Read more »

Senior Couple Walking With Pet Bulldog In Countryside
Investing Articles

As retirement needs soar 60%, here’s how I’m building wealth with UK shares

A regular investment in UK shares and funds could help Brits create a large and lasting pension. Our writer Royston…

Read more »

Investing Articles

I’d buy Games Workshop shares before they reach the FTSE 100!

Games Workshop shares look likely to join the FTSE 100 soon. Here’s why I think investors should consider buying the…

Read more »

Businesswoman calculating finances in an office
Investing Articles

Could me buying this stock with a $2.5bn market-cap be like investing in Tesla in 2010?

Archer Aviation (NASDAQ:ACHR) stock's nearly doubled so far in November. Could this start-up be another Tesla in the making?

Read more »

Investing Articles

5,000 shares of this UK dividend stock could net me £1,700 a month in passive income

Our writer calculates the passive income he could earn from holding a significant number of shares in this powerful dividend-paying…

Read more »

Investing Articles

9.3%+ yields! 3 FTSE 100 dividend giants to consider buying

Our writer examines a trio of high-yield FTSE 100 shares and explains some of the opportunities and risks he sees…

Read more »

Investing Articles

As the Kingfisher share price drops on Budget fallout, should I buy?

The Kingfisher share price was on a strong 2024 run until the DIY group warned us of the possible effects…

Read more »