Pearson Hikes Dividend by 7% to Yield 3.9%

LONDON -- The shares of Pearson  (LSE: PSON  ) (NYSE: PSO  ) were flat at 1,146p early this afternoon after the Financial Times publisher reported first-quarter sales rising 3%, to £1.2bn.

Pearson, which also publishes the Penguin books, revealed it expects operating profits for 2013 to be broadly similar to 2012, or 82p per share, in line with market expectations.

The company confirmed that profits will be lower in the first half of 2013, however, due to the phasing-in of £150m of restructuring costs to "reshape the company," and tackle new opportunities in digital print and developing markets.

The Financial Times segment of Pearson's business reported a 4% increase in digital subscriptions to 328,000, but faced "weak trading conditions for advertising" according to the company.

Looking at the year ahead, Pearson said:

We expect the external environment to remain challenging for our developed world and publishing businesses in 2013 owing to a combination of cyclical and structural factors: pressures on education budgets and college enrollments; retail consolidation; the shift in our business model from print sales to digital subscriptions; changing consumer behaviour and a dynamic competitive landscape.

In general, we expect market conditions to remain favourable for our businesses in developing economies and education software and services.

With a market cap of £9.3bn, Pearson is valued at 15.5 times expected earnings. The company will vote today to confirm an increase in the full-year dividend to 45p per share, offering a trailing dividend yield of 3.9%.

Of course, whether that valuation and the prospects for global publishing combine to make Pearson a "buy," is something only you can decide.

But if you already own shares in Pearson and are looking for alternative investment opportunities, this exclusive wealth report reviews five particularly attractive possibilities.

Indeed, all five opportunities offer a mix of robust prospects, illustrious histories, and dependable dividends, and have just been declared by the Fool as "5 Shares You Can Retire On!"

Just click here for the report -- it's free.


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: 2389600, ~/Articles/ArticleHandler.aspx, 8/23/2014 7:35:14 AM

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...

Today's Market

updated 10 hours ago Sponsored by:
DOW 17,001.22 -38.27 -0.22%
S&P 500 1,988.40 -3.97 -0.20%
NASD 4,538.55 6.45 0.14%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

8/22/2014 4:00 PM
PSO $18.73 Up +0.10 +0.54%
Pearson PLC (ADR) CAPS Rating: **
PSON $1128.00 Up +3.00 +0.27%
Pearson CAPS Rating: No stars

Advertisement