What This Top Dividend Portfolio Is Holding Now: GlaxoSmithKline plc, HSBC Holdings plc And Vodafone Group plc

GlaxoSmithKline plc (LON:GSK), HSBC Holdings plc (LON:HSBA) and Vodafone Group plc (LON:VOD) are the heavyweight holdings of Temple Bar Investment Trust PLC (LON:TMPL).

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Temple Bar Investment Trust (LSE: TMPL) is on track for 30 years of unbroken dividend growth after lifting its recent interim dividend by 3%. At a current share price of 1,191p, the trust is on a trailing yield of 3.1%.

Picking great dividend shares has helped Temple Bar outperform the FTSE All-Share Index over the past three, five and 10 years.

Let’s take a look at Temple Bar’s current top three holdings: GlaxoSmithKline (LSE: GSK), HSBC Holdings (LSE: HSBA) and Vodafone (LSE: VOD) (NASDAQ: VOD.US).

GlaxoSmithKline

Leading FTSE 100 pharma firm GlaxoSmithKline released satisfactory first-half results a couple of weeks ago. The drugs and consumer healthcare giant reaffirmed its full-year guidance of core earnings per share (EPS) growth of 3-4%, with turnover growth of around 1% (both at constant exchange rates).

The board declared a second-quarter dividend of 18p, the same as the first-quarter. The 36p payout to date represents a 5.9% increase on the same period last year. In the circumstances, the analyst consensus of 4% growth for the full year looks a little mean. However, the consensus for 2014 is for growth to accelerate to 6.8%.

At a recent share price of 1,671p, GlaxoSmithKline offers a dividend yield of 4.6% based on the 2013 forecasts, rising to 4.9% for 2014.

HSBC

Banking behemoth HSBC reported big growth numbers for profit and EPS within its half-year results announced earlier this week. However, the numbers weren’t quite as big as analysts were hoping for and the market was underwhelmed. The shares are currently down over 7% on their closing price last week.

The board announced a dividend of US$0.10 (up 11.1%) for the second quarter, delivering on a commitment made at the start of the year for that level of payout in each of the first three quarters. Analysts are expecting double-digit growth to be maintained for the full year, with more of the same for 2014.

At a recent share price of 704p, HSBC offers a dividend yield of 4.8% on 2013 forecasts, rising to 5.4% for 2014.

Vodafone

Telecoms titan Vodafone reported a mixed picture within its most recent trading update last month, but the chief executive told shareholders: “Although regulation, competitive pressures and weak economies, particularly in Southern Europe, continue to restrict revenue growth, we continue to lay strong foundations for the longer term”.

Vodafone’s share price continues to be buoyed by talk of a telephone-numbers-sized deal for its stake in US operator Verizon Wireless. If such a deal did happen it would obviously have potential implications for Vodafone’s dividend. The company would lose the ongoing cash flow from Verizon but would gain a whopping great pile of cash in one fell swoop.

In the meantime, Vodafone this year changed its dividend policy from at least 7% annual growth to the rather less appealing at least maintain the dividend at current levels. However, analysts are forecasting some growth in the payout this year and next — giving yields of 5.2% and 5.4%, respectively, at a recent share price of 199p.

Happy retirement!

If you already have GlaxoSmithKline, HSBC and Vodafone tucked away in your portfolio and are in the market for more blue-chip dividend dynamos, I recommend you help yourself to the very latest free Motley Fool report.

The Fool’s top analysts have identified five companies they believe will generate superior long-term growth in earnings and dividends. Such is their conviction about the quality of these businesses that they’ve called the report “5 Shares To Retire On“.

You can download this free report right now — simply click here.

> G A Chester does not own any shares mentioned in this article. The Motley Fool has recommended shares in GlaxoSmithKline and Vodafone.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

More on Investing Articles

Investing Articles

Here’s how I’d aim for a ton of passive income from £20k in an ISA

To get the best passive income from an ISA, I think we need to balance risk with the potential rewards.…

Read more »

Abstract bull climbing indicators on stock chart
Investing Articles

2 FTSE 100 stocks I’d buy as the blue-chip index hits record highs

This Fool takes a look at a pair of quality FTSE 100 stocks that appear well-positioned for future gains, despite…

Read more »

Satellite on planet background
Small-Cap Shares

Here’s why AIM stock Filtronic is up 44% today

The share price of AIM stock Filtronic has surged on the back of some big news in relation to its…

Read more »

Bus waiting in front of the London Stock Exchange on a sunny day.
Investing Articles

At a record high, there can still be bargain FTSE 100 shares to buy!

The FTSE 100 closed at a new all-time high this week. Our writer explains why there might still be bargain…

Read more »

Asian man looking concerned while studying paperwork at his desk in an office
Investing Articles

After profits plunge 28%, should investors consider buying Lloyds shares?

Lloyds has seen its shares wobble following the release of its latest results. But is this a chance for investors…

Read more »

Abstract bull climbing indicators on stock chart
Investing Articles

Something’s changed in a good way for Reckitt in Q1, and the share price may be about to take off

With the Reckitt share price near 4,475p, is this a no-brainer stock? This long-time Fool takes a closer look at…

Read more »

Investor looking at stock graph on a tablet with their finger hovering over the Buy button
Investing Articles

This new boost in assets might just get the abrdn share price moving again

The abrdn share price has lost half its value in the past five years. But with investor confidence returning, are…

Read more »

Young Black man sat in front of laptop while wearing headphones
Investing Articles

As revenues rise 8%, is the Croda International share price set to bounce back?

The latest update from Croda International indicates that sales are starting to recover from the end of 2023, so is…

Read more »