3 More FTSE 100 Growth-and-Income Shares

LONDON -- Some investors prioritize capital growth through a rising share price, while some prioritize a high income from a big dividend yield. And growth-and-income shares offer investors a bit of both.

British American Tobacco (LSE: BATS  ) (NYSEMKT: BTI  ) , Reed Elsevier (LSE: REL  ) (NYSE: RUK  ) , and AMEC (LSE: AMEC  ) are three companies from the U.K.'s elite FTSE 100 index that have grown both their earnings and dividends faster than inflation and are forecast to continue doing so.

British American Tobacco
British American Tobacco, the world's most international tobacco company, has flown safely through the past five years of economic turbulence. Growth has been driven by the group's four key brands -- Dunhill, Kent, Lucky Strike, and Pall Mall -- and by markets outside the struggling Southern Europe region.

Last week, in its results for 2012, BAT announced a 7% increase in both earnings per share and dividend. Analysts expect EPS to rise by an average 9% a year for each of the next two years, with dividend growth tracking earnings.

At a recent share price of 3,508 pence, BAT is trading on 16 times forecast 2013 earnings -- a little above the Footsie average -- but with a higher-than-average dividend yield of 4.2%.

Reed Elsevier
Reed Elsevier, the international publisher of scientific, academic and business information, reported a solid set of results for 2012 last week and gave an upbeat outlook for 2013. Last year, like BAT, Reed Elsevier increased both its EPS and dividend by 7%. Analysts are forecasting EPS growth of 5% for 2013, rising to 8% in 2014, with a 6% uplift in the dividend each year.

At a recent share price of 721 pence, Reed Elsevier is trading on less than 14 times forecast 2013 earnings and offers a dividend yield of 3.5% -- both a little more attractive than the FTSE 100 average.

AMEC
This British multinational consultancy, engineering, and project-management group is focused on the natural-resources and infrastructure markets. Despite the tough economic environment of the past five years the company has been growing strongly.

Last month, AMEC announced a 14% increase in EPS for 2012 and hiked its dividend by 20% "as a mark of our continued confidence in the outlook." Analysts are expecting high-single-digit earnings and dividend growth for 2013, with a return to double-digit growth in 2014.

At a recent share price of 1,037 pence, AMEC is trading on less than 12 times forecast 2013 earnings and offers a dividend yield of 3.7% -- both attractive relative to the market average.

Growth and income
If you're an investor who's more interested in growth than income, you may wish to read this exclusive in-depth report. The company featured has excellent growth potential -- and has just been declared "The Motley Fool's Top Growth Stock For 2013." Just click here to download the report -- it's free.

If income is more important to you, we have another exclusive report that features a great dividend share. This company offers a juicy 5.7% yield -- and our analysts have declared it "The Motley Fool's Top Income Stock For 2013." This report is also 100% free -- simply click here.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2290333, ~/Articles/ArticleHandler.aspx, 11/28/2014 3:51:52 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement