I reckon there’s good value among stocks in the FTSE 250 index right now. And I’ve bought some of them.
For example, I’m keen on soft drinks maker Britvic (LSE: BVIC). In July, the company said it’s “on track to deliver a full-year performance in line with expectations.” And City analysts have pencilled in an uplift in earnings of just over 37% for the current trading year to 30 September.
We’ll get the actual figures in the full-year report due on 23 November. Meanwhile, there’s a nice dividend for shareholders to collect. With the share price near 738p, the forecast yield for next year is just under 4.3%.
Britvic could run into operational setbacks ahead. But at the moment it’s trading well with a programme of share buybacks in full swing. And apart from 2020 when Covid hit the markets, dividend progression has been steady.
Solid revenue performance
I also like trading platform provider IG Group (LSE: IGG). In September, the firm posted an 11% increase in revenue. And the directors said the “solid” first-quarter revenue performance will help support the company’s medium-term growth targets.
IG has a multi-year record of growing its revenue, earnings and shareholder dividends. And the company is running a programme of share buybacks. But the dividend is attractive too. With the share price near 753p, the forward-looking yield is just above 6% for the trading year to May 2024.
It’s possible for the business to miss its estimates. But trading is strong right now. And IG was one of those firms that managed to keep up its dividend payments through the lockdowns.
Another that’s captured my attention is Investec (LSE: INVP), the banking, investment and wealth management services provider. The company has grown organically and via acquisitions from being a small finance company in South Africa in the 1970s.
Today, Investec’s core operations focus on the UK and South Africa. And it operates internationally as well. The business now sports a market capitalisation of around £3.6bn and has earned its place in the FTSE 250 index.
September’s pre-close trading update indicated a robust set of figures for the first-half period to 30 September. The company expects a chunky double-digit-percentage uplift in earnings. And we’ll get the actual outcome with the half-year report due on 17 November.
Meanwhile, the directors said Investec is “well positioned to continue to support its clients and pursue growth opportunities in line with its strategic objectives.”
City Analysts expect the dividend to increase by just under 14% in the trading year to March 2024. And with the share price near 401p, the forward-looking yield is above 7%. However, it’s possible the firm could miss its estimates. And that’s particularly true if a global economic downturn gathers pace.
Nevertheless, despite the risks, I’m hanging on to my shares in these three FTSE 250 companies. And I hope to own them for decades.