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3 ‘hidden’ growth shares with juicy dividends!

Today I’ll be revealing three companies with outstanding growth potential that also reward investors with chunky dividend payouts. Share price growth AND solid annual income, what more could you ask for?

Small-cap sensation

Small-cap electronic components maker TT Electronics (LSE: TTG) has seen its shares slide in recent weeks, despite issuing a statement earlier this month saying that trading was in line with expectations so far in 2016. The group revealed that revenues were 4% higher year-on-year on a constant currency basis, and said that the integration with recently-acquired electromagnetic components and electronic systems maker Aero Stanrew Group was progressing well.

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The Weybridge-based firm is expected to enjoy an uplift in profits for the full year, with consensus forecasts suggesting 14% growth in earnings per share to 10.01p in 2016, with another 14% rise to 11.38p pencilled-in for next year. Dividends payouts are also expected to improve, with analysts predicting 5.6p and 5.77p per share for this year and next, equating to respectable yields of 4.5% and 4.6%.

I believe the recent dip in the share price presents an excellent buying opportunity with shares trading on a mere 11 times forecast earnings for 2017. TT Electronics should appeal to both value-focused investors and income-seekers as a good best-of-both stock.

Dividend hike

Mid-cap construction group Galliford Try (LSE: GFRD) has enjoyed phenomenal success in recent years with revenues and earnings rising steadily since the start of the decade. Long-term investors will have seen the value of their shares rise from around £2 in 2008, to 2015 highs above £18. But the shares have since fallen back to £14 and are looking good value. Our friends in the City expect the firm’s growth story to continue, with an 11% rise in underlying profits forecast for this year, followed by an even better 20% improvement for FY2017.

Galliford investors have not only seen the value of their shares soar in recent years, but have also been rewarded with rising dividends too. Further dividend hikes are expected over the medium term with 79.7p and 98.6p per share predicted, meaning generous yields of 6% and 7.4% for the next two years. The shares are trading on a bargain price-to-earnings ratio of just nine for the year to June 2017, and coupled with the massive dividend payouts represent an irresistible growth and income play.

No Brexit impact

Finally, we’ll take a look at one of Britain’s leading housebuilders, Bovis Homes (LSE: BVS). The Kent-based business has enjoyed similar success in recent years to construction counterpart Galliford Try, posting double-digit earnings growth in each of the last five years. Management says the company is on track to deliver its planned growth for 2016 as sales prices continue to rise, and reveals that the upcoming Brexit vote has had no impact on the business.

Market consensus suggests that the strong earnings growth will continue over the medium term, with a 16% rise in earnings this year, followed by a further 14% improvement earmarked for 2017. This would leave the shares trading on nine times forecast earnings for this year, falling to just eight times next year. Dividend payouts are also expected to rise again this year, with prospective yields of 4.6% and 5.2% forecast for 2016 and 2017. Bovis Homes is quite possibly the best of the bunch, with a rerating of the shares well overdue, and a well-covered dividend leaving scope for future growth.

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Bilaal Mohamed 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.