Interim season for the FTSE 100 continues strongly next week, with a number of important updates coming from a wide variety of sectors. We’ve already had a look at three companies due to report next week, and here are three more selections representing the utilities, pharmaceuticals and banking sectors:
On Wednesday it’ll be time for interim results from gas and electricity supplier Centrica (LSE: CNA), and things are likely to be boring but steady — just the way income-seekers, who have been turning to reliable dividends in these low-interest times, like it. Centrica, however, has not been kind only to income investors of late, and its share price is up nearly 25% over the past 12 months to 381p.
Inflation is out of control, and people are running scared. But right now there’s one thing we believe Investors should avoid doing at all costs… and that’s doing nothing. That’s why we’ve put together a special report that uncovers 3 of our top UK and US share ideas to try and best hedge against inflation… and better still, we’re giving it away completely FREE today!
Centrica’s dividend yield has been hovering close to 5% over the past few years, with current forecasts suggesting 4.5% for the year to December 2013 and 4.8% for 2014. So what are the prospects looking like?
May’s interim update told us that the company has performed well in the year to date, with the cold start to the year pushing average residential gas consumption up 18% in the first four months and average residential electricity consumption up 3%. Centrica says its residential business should perform in line with expectations, weighted towards the first half of the year.
It’s time for AstraZeneca (LSE: AZN) (NYSE: AZN.US) to spill the beans on its first half on Thursday, so what is the City expecting? Well, with the expiry of some key patent exclusivity (including Seroquel and Crestor) and with competition from generic drugs increasing, AstraZeneca’s earnings per share fell 12% in the year to December 2012 and a bigger drop of 20% is currently expected for this year.
But with the shares currently trading at 3,276p, that does give us a prospective P/E of under 10, and the predicted dividend would yield 5.5%. At first-quarter time, the firm announced a 13% fall in revenue and a 25% fall in core earnings per share, so that full-year prediction might be on the money.
Looking to the longer term, chief executive Pascal Soriot said that the company has “continued to invest in distinctive science that will advance our knowledge of disease physiology and help to identify new drug targets“, and we have seen a couple of key acquisitions in the past few months.
Will they, won’t they, sell the bank? Yes, they will, but when and how are key questions for those watching Lloyds Banking Group (LSE: LLOY) (NYSE: LYG.US), part-owned by UK shareholders. And this year is going to be a key year, with the share price up around 130% over the past 12 months to 69p, and a return to profit, of about £4bn, expected. We should also hopefully see a token dividend this year, and it is expected rise above a 2% yield for the year to December 2014.
The problem with such an analysts’ consensus, though, is that individual forecasts vary quite widely, and they diverge further for 2014 — this really is one over which we should not get too confident.
But having said that, at Q1 time the bank did report underlying profit of £1.48bn, with its net interest margin up to 1.96% in line with expectations, and costs reduced by a further 6%. The bank also expects its core tier 1 ratio to rise above 9% by the end of the year, and to exceed 10% a year later.
Finally, dividends can add nicely to your investment returns — they can be spent or reinvested according to your needs. Whether investing for income or growth, good old cash is always welcome.
And that’s why I recommend the BRAND-NEW Fool report, “The Motley Fool’s Top Income Share For 2013“, in which our top analysts identify a share that they believe will provide handsome dividend income for years to come.
But it will only be available for a limited period, so click here to get your copy today.
> Alan does not own any shares mentioned in this article.