The first was founded in 1825 – Standard Life Aberdeen (LSE: SLA) – and provides asset management services. The company offers investment solutions and funds, long-term savings and investment products to individual and corporate customers, and life insurance and savings products. It also makes real estate investments.

Dividends

Its dividend yield last year was 7.24%, which makes it very attractive to me as an income share. It is expected to be 6% this year and is normally paid at the end of May. For your information, the record date for the next dividend payment will be around the beginning of April. If you are a shareholder on this date, you are entitled to the forthcoming dividend.

Rupert Hargraves of this parish spoke highly of Standard Life in December, and he offered some compelling arguments that this would be its year. These included the fact that the new CEO, Stephen Bird, seemed to be getting to grips with the relatively recently merged entities, Standard Life and Aberdeen Asset Management.

Growth potential

Another company that has had indigestion issues with a takeover is Mitie Group (LSE: MTO). The company was founded in 1987 and, through its through its subsidiaries, provides strategic outsourcing services in the United Kingdom and internationally. It acquired Interserve’s facilities management business and had a rights issue to reduce debt levels. The share price fell from 80p to nearly 35p this past year.

Kirsteen Mackay covered the price plunge at the time, and highlighted the potential upside once the dust settled. Investors who bought at that point would be up 20% now.

In late November 2020, Mitie revealed that while profits and revenues fell in the first half, they were profitable. “Our financial performance in the first six months of the year proved more resilient than expected with a much improved second quarter,” Chief Executive Officer Phil Bentley said.

A great sign of confidence is the fact that senior executives have been buying at the 43p mark (at this moment, Mitie shares are trading at 42p). After all, they know how well they are doing on a day-to-day basis.

The post Why I just bought Standard Life Aberdeen and Mitie Group shares appeared first on The Motley Fool UK.

More reading

• 4 FTSE 250 shares that could generate a 4-figure monthly second income
• How can I target £14,132 a year in dividend income from a £20,000 holding in this FTSE 250 dividend gem?

Michael Breen owns shares in Standard Life and Mitie Group. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

In recent news, Marks and Spencer – which suffered a terrible slump in clothing and home sales over the Christmas period with revenues down 25.1% year on year – is acquiring the Jaeger brand.

Richard Price, who joined M&S from Tesco last year as head of clothing and home, said last week: “We have bought the Jaeger brand and are in the final stages of agreeing the purchase of product and supporting marketing assets from the administrators of Jaeger Retail” according to a report in last Monday’s Financial Times.

Let’s be honest: all high-street retailers have a problem with sales when the government closes the doors…

Meanwhile, this acquisition follows on from the 50% stake in its joint venture with Ocado that is helping to extend its food reach.

Signs maybe of a coherent investment strategy designed to leverage online and brand familiarity? I think Jaeger is a good fit as long as Marks and Spencer doesn’t devalue the brand, as it still has lots of loyal followers who will pay a premium for the quality. In my view, Richard Price has the opportunity to rectify the mistakes made with the Per Una acquisition.

Comfortingly, its food shops are busy, and the queues outside are evidence of the offering being valued. In the days before Christmas, it was noticeable that the shops themselves felt well regulated, which gave reassurance to the monied older customers.

At the end of the day, a lot of high street retail stocks will likely fail, but – as Amazon has shown with its relatively tentative first steps into the high street – well-run retailers will continue to have a place in the shopping malls and surviving high streets. M&S chairman Archie Norman has a good reputation and seems to be developing a strong team.

Trading at £1.90 this time last year, and – as mentioned earlier – 89p in May, Marks and Spencer shares appear to represent cautiously good value at the current £1.35, with the potential to reach £1.79 based on cash flow projections.

Its current price to book ratio is roughly 1. This means that its assets are worth the share price alone, not taking into account any potential future earnings, including those returns from the Ocado investment.

If you aren’t convinced by my arguments for Marks and Spencer, have a look at this Motley Fool article concerning Associated British Foods, which as the owner of Primark should from a return to the high street. This is a company that saw revenues reduced by 12% and yet still returned a healthy profit of in excess of £1,024m.

The post Why I’m considering high street retail stocks for my portfolio again appeared first on The Motley Fool UK.

More reading

• Down 90% and 93%! Are Ocado Group and Aston Martin shares set for a mind-blowing recovery?
• How this £6.24 UK stock is copying Amazon’s winning tactics
• Time to buy Associated British Foods (ABF) shares after this exciting news?
• Is now the time to consider buying Tesco shares?
• The Tesco share price is struggling to regain 500p even after strong results – where to from here?

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Michael Breen has shares in Marks and Spencer. The Motley Fool UK has recommended Associated British Foods and Tesco. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.