Have you used up your £15,000 ISA allowance for 2014-15? If not, you only have until 5 April before a new £15,240 allowance commences. Can you beat the £240 you’d get in interest from the very best cash ISAs? Here are three that should do just that:
Barclays
Barclays (LSE: BARC)(NYSE: BCS.US) is arguably the strongest of our FTSE 100 banks, having found its own way out of the crunch. It’s had its fair share of knocks, with penalties for various misbehaviours, but it’s in a good state now with solid liquidity ratios.
The dividend has been flat for three years, but there’s a nice rise forecast for this year which would provide a 3.5% yield on a price of 252p, rising to 4.5% in 2016 — and that would easily beat the 1.5% or so from a cash ISA.
They’re very well-covered dividends too, and with the shares on a forward P/E of 10, dropping to 8.5 on 2016 forecasts, I reckon Barclays is up there with Lloyds Banking Group as our two best banking candidates right now.
Aviva
If Barclays is our best bank, Aviva (LSE: AV) surely vies for the top spot in the insurance sector. Since the overstretched dividend was cut and the shares slumped to a low in mid 2012, the price has come back strongly and has more than doubled in less than three years to 547p.
We’re now looking at one of the best combinations of low P/E and strengthening dividend in the sector, with forecast multiples of 11 and 9.6 accompanied by yields of 3.7% and 4.5%.
Results for 2014 were strong, with EPS continuing to rise. CEO Mark Wilson said “These results show tangible progress, with all key metrics moving in the right direction“, and I can see that direction continuing for some years yet.
GlaxoSmithKline
Of our two big FTSE pharmaceuticals, I reckon you’d do well with either AstraZeneca or GlaxoSmithKline (LSE: GSK)(NYSE: GSK.US) for the long term, but today I’m looking at the latter. Glaxo shares are down 9% over the past year, but with a return to EPS growth forecast for 2016 and dividends set to yield 5.2%, that could give is a buying opportunity.
Turnover in 2014 fell 13% in sterling (with the strengthening pound not helping), but that was expected and the shares have perked up a little since the figures were released. The firm expressed its longer-term confidence by raising the dividend 3% and reiterated its plan to maintain it at the same level in 2015.
Even without any share price rise, a 5.2% yield would add £792 if you filled your ISA with Glaxo (just for illustration, of course).
