Bus and train operator National Express Group (LSE: NEX) enjoyed a strong start to the year, with total revenue up 11% excluding exchange rate effects.

Although revenue was given a big boost by the start of a new rail operation in Germany in December, underlying revenue from existing operations was still up 4%, with growth in every division. Passenger numbers were higher too, with underlying growth of 3%.

According to the latest broker forecasts, adjusted earnings per share should rise 3.4% to 24.6p this year. This puts National Express on a 2016 forecast P/E of 13.5, which seems reasonable.

However, the firm’s dividend potential is of more interest, expected to rise by 7% to 12.1p this year, giving a forecast yield of 3.6%. This payout would cost £62m, so should be comfortably covered by the group’s targeted free cash flow of £100m.

Young upstart looks cheap

Shares in challenger bank OneSavings Bank (LSE: OSB) have fallen by 20% so far this year, but today’s trading statement suggests this stock could be an attractive buy.

The bank generated £627m of new business during the first quarter and acquired a further £131m of business. OneSavings confirmed that it expects to report a net interest margin of 3% for the full year, with a cost-to-income ratio of about 26%.

These figures are significantly better than any of the big banks can manage, making me wonder whether I should look at small banks as potential dividend buys. OneSaving’s decline this year has certainly made the stock cheap enough to be a dividend contender.

The stock now trades on a 2016 forecast P/E of 7.5, with a prospective yield of 3.4%. In 2017, earnings per share are expected to rise by 11%, while the dividend is expected to jump 22% to 11.7p per share, giving a potential yield of 4.1%.

As far as I can see, OneSavings is financially sound and profitable. The only risk with investing in such a small bank is that it may never achieve the scale needed for viable long-term future. At today’s price, I think that could be a risk worth taking.

Is insurance returning to growth?

Lloyds insurer Novae Group (LSE: NVA) insures assets such as ships, oil rigs and buildings against a wide range of risks.

It’s a complex business to understand, but Novae has been a very profitable investment in recent years. The shares have doubled since the start of 2013 while paying out generous dividends.

Novae currently trades on just 10-times forecast earnings and offers a prospective yield of 4.1%. The firm’s gross written premium rose by 9.8% to £282.8m during the first quarter, according an update today. That’s a welcome sign of growth in a sector where pricing has been under pressure. Quality players like Novae have actually been turning down sub-profitable business.

However, claims levels have also been low, which has allowed Novae to return fairly high levels of cash to shareholders each year. A costly string of claims, however, could put pressure on dividend growth, but this appears to be a well-run company in a sector that has seen a lot of takeover activity recently.

I reckon that Novae, National Express and OneSavings Bank could make profitable income buys. But they didn't make the grade when the Motley Fool's investment experts produced A Top Income Share From The Motley Fool.

The company featured in this report is a home-grown success story with a strong overseas business.

The Fool's gurus believe that profits may be about to rocket, thanks to improving trading conditions in a key market.

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Roland Head 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.