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A FTSE 250 dividend stock that could help you quit your job

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In a recent article I took the chance to have a look at two terrific FTSE 100 income shares with enough ‘wow’ factor to help share investors ditch the day job.

In this piece, I plan to inform you of another similarly-liberating share, this time from the London Stock Exchange’s second tier: PageGroup (LSE: PAGE).

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Packed with potential

I have touted PageGroup as an exceptional dividend share for a very long time now. I’m taken by the impressive progress it is making across the globe, a detail that was again laid bare in its latest trading statement last week.

The FTSE 250 recruiter saw gross profits charge 16% higher between April and September to stand at a fresh quarterly record of £208.2m. The UK again proved problematic for the company, with profits here ducking 1.9% year-on-year. However, its home terrain accounts for less than a fifth of profits at group level, giving its top line a terrific buffer against the on-going political and economic maelstrom in Britain.

It’s this foreign exposure that has led City analysts to predict earnings will continue growing by double-digit percentages — rises of 16% and 12% are forecast for 2018 and 2019, respectively.

And the outperformance of its so-called Large, High Potential markets in particular, and the vast investment it’s making in these regions, convinces me that profits should continue ripping higher at quite a pace.

Big on foreign shores

PageGroup has packaged up five of its territories into its Large, High Potential market category — Germany, Greater China, Latin America, South East Asia and the US. And each and every one of these destinations printed record gross profits during Q2.

The company is going full steam ahead to try and latch onto the favourable demographic and economic factors in these geographies to try and drive profits. In the last quarter, it opened a new office in Vietnam, the fifth country from which it operates in South East Asia.

And PageGroup has a view of hitting a global headcount of 10,000 under its current growth plan, up from 7,457 presently.

Special dividend star

Thanks to its great profits outlook and rock-solid balance sheet (it had net cash of £85m at the end of the second quarter), the number crunchers are expecting the special dividends to keep on coming during the medium term.

Last year’s total payment of 25.23p per share is anticipated to rise to 26.5p next year, and again to 29.1p in 2019. This means that yields stand at a chunky 4.4% for this year, and 4.8% for next year. And who would bet against dividends continue beating those of the broader market beyond then?

PageGroup’s stunning share price run since the start of 2018, during which time the company’s value has swelled by more than 30%, indicates the growing belief the investment community has in the company’s long-term earnings picture.

That said, I would argue that the recruitment giant still remains undervalued as of today with PageGroup carrying a forward PEG ratio of just 1.2 times. This leaves plenty of scope for further share price gains in the months ahead.

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Royston Wild has no position in any of the shares mentioned. 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.

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