Is Now The Time To Buy 5%+ Yielders BHP Billiton plc, Esure Group PLC, Amec Foster Wheeler PLC & Jupiter Fund Management PLC?

Royston Wild examines whether investors should splash the cash on BHP Billiton plc (LON: BLT), Esure Group PLC (LON: ESUR), Amec Foster Wheeler PLC (LON: AMFW) and Jupiter Fund Management PLC (LON: JUP).

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Today I am looking at four FTSE heavyweights expected to deliver monster dividends.

BHP Billiton

With commodities of all classes crashing through the floor I believe BHP Billiton (LSE: BLT) is a perilous selection for dividend seekers. Diversified mining peer Glencore’s announcement today that earnings slumped 29% during January-June to $4.6bn thanks to weak metal and energy prices heaps fresh worry onto the sector, naturally, and with insipid demand and mining capacity increases set to endure I believe investment in the sector remains foolhardy.

Despite the threat of heavy earnings dips in the medium term — the City has pencilled in drops of 49% and 37% for the years ending June 2015 and 2016 respectively — BHP Billiton is still expected to raise last year’s dividend of 121 US cents per share to 123 cents for these years, yielding a vast 6.9%. But with BHP Billiton nursing a colossal $24.9bn debt pile and facing intensifying revenues worries, I reckon income hunters may be shocked by the firm’s upcoming full-year results.

Esure Group

Motor insurance giant Esure (LSE: ESUR) disappointed the market earlier this month when it advised underlying pre-tax profit skidded 21.3% lower during the first half, to £46.5m. The company was hampered by increasing personal injury claims, a phenomenon that has forced Esure to “seek to implement further rate increases in the second half of the year.”

As a consequence the business reduced the interim dividend to 4.1p per share from 5.2p during the corresponding period in 2014, forcing the City to downgrade dividend predictions — indeed, falling earnings are expected to push Esure’s total dividend from 15.3p last year to 13.9p. Still, this figure produces a meaty yield of 5.8%. And improving premiums across the industry are expected to push the payment higher again in 2016 to 15.1p as the bottom line rebounds, driving the yield to 6.3%.

Amec Foster Wheeler

Thanks to its expertise across a wide array of engineering sectors, I believe Amec Foster Wheeler (LSE: AMFW) is on course to keep delivering bumper dividend yields in the years ahead. While it is true the firm’s exposure to the oil sector is souring the firm’s sales outlook, the business remains a big player in this area and just yesterday was awarded a project management consultancy contract extension for the redevelopment of the Upper Zakum field in Abu Dhabi.

Still, pressures in the fossil fuel sector are expected to push earnings lower again in 2015, resulting in a slight reduction in the dividend from 43.3p per share last year to 42.5p. This projection still creates a chunky 5.1% yield, however, and which moves to 5.2% for next year as strong growth elsewhere — and therefore an anticipated return to earnings growth — drives the dividend to 43.1p.

Jupiter Fund Management

I reckon investment specialists Jupiter Fund Management (LSE: JUP) should continue offering up exceptional payout prospects as ongoing diversification into different product classes, territories and client bases pays off. On top of this, the company’s brilliant exposure to the UK retail savings market should deliver plentiful gains as the domestic economy takes off — last month Jupiter advised that assets under management rose 3% in January-June, to £34.3bn.

For 2015 the business is expected to fork out a chunky dividend of 24.2p per share, a huge upgrade from the 13.2p per share reward in the prior 12 months and which yields a mouth-watering 5.3%. And predictions of sustained earnings expansion through to the end of next year push the dividend forecast to 26.6p for 2016, creating an irresistible 5.8% yield.

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.

Royston Wild 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.

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