3 FTSE 100 Growth-and-Income Shares

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

Imperial Tobacco Group  (LSE: IMT  ) (NASDAQOTH: ITYBY  ) , J Sainsbury  (LSE: SBRY  ) (NASDAQOTH: JSAIY  ) , and TUI Travel  (LSE: TT  ) are three companies from the U.K.'s elite FTSE 100 index that have grown both their earnings and dividends faster than inflation are forecast to continue doing so.

Imperial Tobacco
Imperial Tobacco, the Bristol-headquartered international tobacco company, has been a safe port for investors through the past five years of stormy economic seas. Growth has been driven by the group's key strategic brands -- Davidoff, Gauloises, West, and JPS -- and by markets outside the moribund EU region.

Last year, Imperial Tobacco increased its earnings per share (EPS) by 7% and its dividend by 11%. Analysts expect EPS to rise 5.5% this year and 7.5% in 2014, with the dividend lifted 9.5% and 10.5%.

At a recent share price of 2,344 pence, Imperial Tobacco is trading on 11 times forecast 2013 earnings and offers a dividend yield of 4.9% -- both attractive relative to the FTSE 100 average.

J. Sainsbury
Sainsbury's has good momentum in its business, outshining FTSE 100 supermarket peers Tesco and Morrisons. Latest figures from Kantar Worldpanel for the 12 weeks to Feb. 17 show the trend continuing: Sainsbury's was the only one of the three to increase its grocery market share during the period.

Last year, Sainsbury's increased EPS by 6% and its dividend by 6.6%. Analysts are forecasting EPS growth of 5% to 6% for each of the next three years, with dividend growth running at around 4%.

At a recent share price of 341 pence, Sainsbury's is trading on 11.5 times forecast 2013 earnings and offers a dividend yield of 4.9% -- again, both attractive relative to the FTSE 100 average.

TUI Travel
Tour operator TUI Travel has weathered the last five tough years very well, helped by the collapse of some large competitors and innumerable smaller operators.

Last year, TUI Travel increased EPS by more than 9% and its dividend by 3.5%. Analysts expect EPS growth to average 8% a year for the next two years with dividend growth of the same order.

At a recent share price of 311 pence, TUI Travel is trading on just over 11 times forecast 2013 earnings and offers a dividend yield of 3.9% -- once again, both attractive relative to the FTSE 100 average.

Growth and income
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