In a recent article I discussed some FTSE 100 income stocks which could thrive irrespective of how, and when, Britain finally withdraws from the European Union.
Right now the likely path to Brexit remains as clear as mud and so I feel it’s a good time to discuss more blue-chips that could thrive irrespective of the UK’s future relationship with the EU27 and how this impacts the domestic economy.
The crisis in the National Health Service means that demand for private healthcare has ballooned in the UK in recent years, but the economic implications that a damaging Brexit would probably have on citizens’ spending power means that these bright growth rates could be in jeopardy.
This is where NMC Health (LSE: NMC) comes in. Sure, it’s a major player in the private healthcare sector, but its hospitals can be found in the United Arab Emirates. And thanks to a combination of growing personal wealth levels and the Footsie firm’s expansion in these faraway lands, I’m confident that it can keep on thriving.
NMC put in another year of record sales and profits in 2018, and City analysts are expecting another stunning earnings rise in 2019, this time by 33%. It’s why they also expect dividends to keep surging, with an anticipated reward of 32.6 US cents per share up from 18.1 cents last year and yielding a handy 1.1%.
If you’re looking for bigger dividends then you might want to give International Consolidated Airlines Group (LSE: IAG) a close look.
City consensus suggests that the British Airways owner will experience a rare earnings dip in 2019 in reflection of the ‘fare wars’ raging across the European budget segment and rising fuel costs more recently: a 5% bottom-line reversal is currently anticipated.
Despite this, IAG is expected to still raise the full-year ordinary dividend to 32 euro cents per share from 31 cents in 2018, resulting in a chunky 5.3% yield. Even if the business doesn’t pay more special dividends like it did last year, there’s still plenty for dividend hunters to sink their teeth into.
I’m confident that the long-term earnings outlook remains bright, and that City brokers will keep predicting dividend growth long beyond the near term. Full-year results released late last month reinforced my positive take as well. Despite fuel costs rising by almost a third in 2018, plus damaging currency movements and air traffic strikes in France, group operating profit (before exceptionals) rose 9.5% to €3.2bn.
Now of course a painful Brexit could have an impact upon IAG’s operations given the likelihood that consumer appetite for big-ticket items like holidays could fall. But the UK remains a very small part of the profits pie for this Footsie firm. And as the company bulks up its route network and its fleet, a strategy which pushed passenger numbers 6.1% higher year-on-year in March to 7.5m, it’s reducing its reliance on its home territory and establishing a base for excellent long-term profits growth. Like NMC, I reckon the flyer is a great pick for all long-term income investors.
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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended NMC Health. 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.