Here’s a dividend stock with growth potential in 2022

2022 is going to be a year of rising costs and rising interest rates if the experts are correct. This means I am looking for stocks to invest in that could actively benefit from meeting these specific criteria. I think I have found at least one. Pleasingly, I think it is a dividend stock with growth potential.

The stock I am referring to is Moneysupermarket.com (LSE:MONY). I expect it to make something of a comeback in 2022. For my money, Moneysupermarket.com has the makings of a solid long-term investment for my portfolio. Let me explain my thinking.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

We’re sharing the names in a special FREE investing report that you can download today. And if you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio.

Click here to claim your free copy now!

Growth has stuttered

The company has found things tough over the past 12 months. According to its most recent financial statement in October, revenue was down 11% year to date compared to the corresponding period in 2021. Obviously, this was not good.

It goes a long way towards explaining why the share price has been trading so low. Investor sentiment has cooled, with the stock at almost half the price it was three years ago. 

That’s the bad news. The good news is that the firm has taken steps to address this.

Proven model and new advertising

The price comparison model is one long proven to work. If consumers want to save money on household or financial products, they know a visit to a price comparison website should help them do that. 

So, to compete, this means Moneysupermarket.com need to shout louder than its major rivals, such as Go Compare and Compare The Market, in order to grab increased share of wallet.

The Moneysupermarket.com brand was relaunched last autumn with a well-received advertising campaign. The fact that it identified the need to reposition its brand demonstrates customer-centric awareness and a willingness to respond to changes in a competitive market. Taking steps to make the brand more competitive is only a good thing.

It remains a good dividend stock

While it’s good to see Moneysupermarket.com actively changing its advertising to be more competitive, I don’t think this is going to be the key driver of rising revenue. I think increased revenue will come from increasing numbers of consumers switching financial products more readily in 2022. The changes to advertising kick-start this, in my view.

Why do I think this? Well, I expect consumers to spend more money throughout the year on the things they want to enjoy, in very general terms, simply because I expect the Covid-19 shackles to come off. I believe there is going to bean  increased desire to save money on the boring things in life, such as utility bills, in order to free up funds for more ‘adventurous’ spend, such as holidays. This will be especially the case if inflation takes hold and household energy costs continue to rise. Don’t get me wrong, it is only a personal hypothesis, but one that I think stands up to scrutiny bearing in mind the last two years.

Moneysupermarket.com look in decent shape financially, so I do not have any concerns on that score. To cap it off, the company remains a good-looking dividend stock, with an expected dividend yield of around 5.3%. All in all I have warmed to this stock. I think it could be a shrewd longer-term investment for my portfolio.

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While it’s available: you’ll discover what we think is a top growth stock for the decade ahead.

And the performance of this company really is stunning.

In 2019, it returned £150million to shareholders through buybacks and dividends.

We believe its financial position is about as solid as anything we’ve seen.

  • Since 2016, annual revenues increased 31%
  • In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259
  • Operating cash flow is up 47%. (Even its operating margins are rising every year!)

Quite simply, we believe it’s a fantastic Foolish growth pick.

What’s more, it deserves your attention today.

So please don’t wait another moment.

Get the full details on this £5 stock now – while your report is free.


Garry McGibbon has no position in any of the stocks mentioned. The Motley Fool UK has recommended Moneysupermarket.com. 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.

Can I simplify my passive income for 2022 with this dividend-paying ETF?

Passive income is regular income from an asset, like a stock, that requires little effort or maintenance. I’m constantly on the hunt for hands-off returns and in  2022, I’m once again looking at long-term dividend streams.

There are some fantastic high-paying dividend stocks in the FTSE 100. However, I’m a fan of exchange traded funds (ETFs).

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

We’re sharing the names in a special FREE investing report that you can download today. And if you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio.

Click here to claim your free copy now!

ETFs are funds that track an index or sector and can be bought and sold like shares through most online brokers. They allow me to invest in multiple companies in a single fund and are usually low-cost. 

My pick

The one I’ve been exploring is SPDR S&P UK Dividend Aristocrats ETF (LSE:UKDV). As the name suggests, this fund tracks the S&P UK High Yield Dividend Aristocrats Index.

This index follows the 40 highest-dividend-yielding UK companies that have either increased or maintained their dividends for at least seven consecutive years. It also focuses on large firms as new entrants to the index must have a market cap of at least $1bn. The businesses also have to meet the index’s liquidity requirements.

One of the main reasons I like ETFs is the diversification they provide. This fund consists of 40 companies across several industry sectors. I believe that having a large number of companies within it provides a high degree of resilience. If any individual firm falters, because the weighting of every company is limited to a maximum of 5%, the overall downside to the ETF is limited. 

Companies in this fund are mostly large blue-chip entities across a variety of sectors such as insurance, mining and pharmaceuticals. Household names include the likes of Legal & General, Rio Tinto and GlaxoSmithKline.

The ongoing charge is a very reasonable 0.3% and in terms of passive income, the current dividend yield is 3.59%, payable biannually.

OK, that’s not a huge yield. I can find some companies within the FTSE 100 paying much bigger dividends at the moment. For example, Evraz, the steel-making and mining company, has a current dividend yield of over 11%. However, for my portfolio, I find holding an ETF a simpler and stress-free approach rather than picking individual shares.

Long-term income

No investment is guaranteed, but I’m looking for a simple, long-term income stream. I think buying and holding this fund might be easier for me over the long run than hunting for individual dividend-paying shares. This ETF rebalances each year as the index updates. This means that companies move in and out of the fund automatically, without any input from me. 

This ETF is by no means perfect. Some of these dividend-paying companies will be successful firms that have strong free cash flows. However, some will feel they have to maintain high yields to keep their investors happy even though the business is not growing. In the long run, not only will the dividends be unsustainable, but the firms could even fail.

Despite this, on balance, I’m happy to consider this dividend-paying ETF as a low maintenance, diversified, passive income stream for my portfolio.

Is this little-known company the next ‘Monster’ IPO?

Right now, this ‘screaming BUY’ stock is trading at a steep discount from its IPO price, but it looks like the sky is the limit in the years ahead.

Because this North American company is the clear leader in its field which is estimated to be worth US$261 BILLION by 2025.

The Motley Fool UK analyst team has just published a comprehensive report that shows you exactly why we believe it has so much upside potential.

But I warn you, you’ll need to act quickly, given how fast this ‘Monster IPO’ is already moving.

Click here to see how you can get a copy of this report for yourself today


Niki Jerath has no position in any of the shares mentioned. The Motley Fool UK has recommended GlaxoSmithKline. 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.

6 UK shares with dividend yields of over 6%

For some investors income is very important. For me, dividend income is a major part of my total returns. I’m always keeping an eye out for higher-yielding shares that will hold, or even better increase, their value over time. I like the look of these six UK shares with dividend yields of over 6%.

High-yielding UK shares

Rio Tinto is one of the highest-yielding UK-listed companies. Its shares yield over 10% if I include special dividends. The mining company has had its share of controversies and is heavily reliant on metal prices such as iron ore. Unfortunately, the price fell heavily in the second half of 2021. Nonetheless, if I wanted to add a lot of income to my portfolio, I’d consider buying the shares that are also relatively cheap on a P/E of nine.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

We’re sharing the names in a special FREE investing report that you can download today. And if you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio.

Click here to claim your free copy now!

Another FTSE 100 company I like for its income is the housebuilder Persimmon. The share price may come under pressure due to housebuilders being hit with higher costs for cladding removal, but Persimmon has already set aside money for this and mostly focuses on houses, not high rises. Less government support for housebuilding may also hit it. It faces some potential headwinds for sure, but compensating for that is a dividend yield of nearly 9%. I already own some shares and may buy more if the share price dips.

Imperial Brands is a ‘Marmite‘ share, in that you either love it or hate it. As a tobacco company, many investors will give it a miss on ethical grounds. That’s fine. Yet many higher-yielding investment trusts hold tobacco stocks and there can be no arguing Imperial Brands is a cash generative business. That allows it to have a far above average dividend yield. The shares yield 8.5%. Despite this, I’ll avoid the shares, as I think tobacco stocks could remain under pressure.

Three investment trusts

Apart from the UK’s largest companies, another good way I’ve found to access high yields is to look at investment trusts. These have the added benefits of being professionally managed and can be more diversified. They aren’t, of course, without risk and can be expensive, so charges are worth me keeping an eye on.

These three investment trusts are all high-yielding and could add more income to my portfolio.

Henderson Far East Income is a trust that invests across Asia Pacific with the target of delivering income growth. About 22% of it is invested in Australia, 17% in Taiwan and 16% in South Korea. Other top countries it invests in are China/Hong Kong, Singapore and Vietnam. The trust invests in about 47 different companies and the shares yield about 8%.

BioPharma Credit strikes me as a bit riskier. It provides debt to life sciences companies, which see a high rate of failures, if for example, a drug trial proves fruitless. But it seems to have a good track record of backing viable companies. On top of that, the shares yield 7.1%.

A third interesting higher-yielding investment trust is AEW UK REIT. It’s a specialised property investor. The shares yield 7%.

On balance, I’m most drawn to Henderson Far East Income and I’m thinking of adding it add to my portfolio, despite the geopolitical risks that come with it investing in China and Hong Kong. 

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic…

And with so many great companies still trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down…

You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm.

That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away.

Click here to claim your free copy of this special investing report now!


Andy Ross owns shares in Persimmon. The Motley Fool UK has recommended Imperial Brands. 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.

Warren Buffett’s still bullish on Apple. Here’s when I think the stock could hit $4trn!

On 3 January, consumer tech giant Apple (NASDAQ:AAPL) became the world’s first $3trn company for a brief time.

The company, which is the largest holding in Berkshire Hathaway’s portfolio, representing over 40% of its total at around $150bn, has had a phenomenal 18 months. 

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

We’re sharing the names in a special FREE investing report that you can download today. And if you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio.

Click here to claim your free copy now!

Recent performance

Apple’s share price rose more than 30% in 2021 as coronavirus lockdowns saw spending on iPhones, Macs and iPads rise. In fact, as of the end of September 2021, the company was earning more than $1bn a day.

Also, in early December the stock price rose further after Morgan Stanley increased its 12-month price target to $200 while Moody’s upgraded Apple to a triple-A rating.

Revenue and potential

The iPhone accounts for around half of the company’s sales. while its iPads and Mac computers also provide substantial revenue.

However, an increasingly important source of revenue is the tech giant’s services business. This includes software sold through the Apple store, storage space via iCloud and streaming services such as its music, television and fitness subscription platforms.

Some analysts see this area as a more reliable revenue source than its physical products. It’s also growing as a percentage of Apple’s total business.

The company has also diversified its hardware offerings into AirPods, Apple Watches and other wearables. This accessory business has grown substantially and is now a business area worth in excess of $30bn annually. 

Looking to the future, virtual and augmented reality products as well as car development and production, could send Apple’s value towards the $4trn mark.

Risks

As with any stock, there are risks, however. First, legislators in Washington and across the world are targeting the tech giants. For Apple, this includes questions about possible monopolistic-like charging on its App Store and potential collusion with Alphabet‘s Google on searches within the App Store.

Second, though the iPhone is the largest contributor to the company’s revenue, its share of the smartphone market is declining. And other Apple products are also high-end items. If world inflation soars, or the world economy falters, then sales could decline in favour of more price-competitive brands,

$4trn?

Despite the risks, I take comfort in the continued support for Apple from Warren Buffett. He reiterated his confidence in the brand and management during Berkshire Hathaway’s 2021 Annual Meeting. Although I could be wrong, this gives me confidence that the tech giant’s stock price might have more upside potential.

The company made its stock market debut in 1980 with a value of $1.8bn. It became the first company to hit a stock market valuation of $1trn in 2018, then a $2trn market cap in 2020. It hit $3trn in 2022. I think a $4trn valuation in 2024 is entirely possible.

Apple’s turnover increased by around 30% in 2021 and although annual revenue growth over the last five years was closer to 10%, profitability seems to be increasing. Free cash flow is also at its highest, which will help the company continue buying back shares as it’s done over the past few years. All of this should help drive the share price higher. That’s before even taking into account potential new products such as self-driving vehicles and wearable headsets targeting the metaverse.

In any case regardless of when, or indeed if, it hits that level, I’m still confident about its growth trajectory and in adding this stock to my own holdings.

Is this little-known company the next ‘Monster’ IPO?

Right now, this ‘screaming BUY’ stock is trading at a steep discount from its IPO price, but it looks like the sky is the limit in the years ahead.

Because this North American company is the clear leader in its field which is estimated to be worth US$261 BILLION by 2025.

The Motley Fool UK analyst team has just published a comprehensive report that shows you exactly why we believe it has so much upside potential.

But I warn you, you’ll need to act quickly, given how fast this ‘Monster IPO’ is already moving.

Click here to see how you can get a copy of this report for yourself today


Niki Jerath does not own shares in Apple. The Motley Fool UK has recommended Apple. 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.

Could the Boohoo share price double my money?

On the face of it, the Boohoo (LSE: BOO) share price looks cheap. The stock is trading at around 114p per share. This time last year, the share price was around 360p. As such, the stock looks cheap compared to its trading history. 

However, just because the stock looks cheap does not mean the company is cheap. The stock price movement does not tell us much about the underlying fundamentals of the enterprise.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

We’re sharing the names in a special FREE investing report that you can download today. And if you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio.

Click here to claim your free copy now!

So from a fundamental perspective, I can see why some investors might think the business is worth less today than it was at the beginning of 2021. 

Boohoo share price performance 

At the beginning of last year, Boohoo was riding high on the back of the lockdown shopping boom. Group profit jumped 44% in its 2021 financial year, as the e-tailer capitalised on its position in the online retail market. 

The market seemed to believe that this trend would continue. Unfortunately, Boohoo’s growth has not continued.

Even though the company’s top line has expanded, higher costs, due to inflation and an increased number of returns, have nibbled away at the group’s profit margin. As such, net profit is projected to fall by 25% in the current financial year. 

Based on current City growth estimates, the stock is now trading at a forward price-to-earnings (P/E) multiple of 19.3. Once again, this looks cheap compared to the company’s history. The Boohoo share price has historically commanded a multiple in the region of 20-40 times earnings. 

Nevertheless, past performance should never be used to guide future potential. Just because the stock commanded an elevated valuation in the past does not mean it should continue to trade a high multiple. 

Boohoo is no longer a high-growth stock. Therefore, it is difficult to justify a high-growth multiple for the shares. 

Additional challenges

The company may also continue to face additional challenges. Inflationary pressures and competition in the e-commerce market are two challenges that will not disappear anytime soon. These headwinds will remain a challenge for the foreseeable future, and they could continue to impact the group’s growth. 

As such, while I do think the Boohoo share price appears cheap compared to its great potential, I do not think the stock has the potential to double from current levels. The business is facing far too many challenges to return to its high-growth multiple. 

Of course, this is just speculation on my part. The stock could double in value over the next couple of years if it manages to surpass growth expectations. The Boohoo share price should track its underlying fundamental performance in the long run. Therefore, if earnings double over the next five years, I do not think it is unreasonable to say that the stock could double as well. 

For this reason, I would buy the stock for my portfolio. I think the company has potential, and I am willing to wait to realise the growth. 

FREE REPORT: Why this £5 stock could be set to surge

Are you on the lookout for UK growth stocks?

If so, get this FREE no-strings report now.

While it’s available: you’ll discover what we think is a top growth stock for the decade ahead.

And the performance of this company really is stunning.

In 2019, it returned £150million to shareholders through buybacks and dividends.

We believe its financial position is about as solid as anything we’ve seen.

  • Since 2016, annual revenues increased 31%
  • In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259
  • Operating cash flow is up 47%. (Even its operating margins are rising every year!)

Quite simply, we believe it’s a fantastic Foolish growth pick.

What’s more, it deserves your attention today.

So please don’t wait another moment.

Get the full details on this £5 stock now – while your report is free.


Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has recommended boohoo group. 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.

Is this dirt-cheap FTSE 100 stock with 15% dividend yield a good buy for me?

What is not to like about a FTSE 100 stock that is also dirt-cheap and has a massive dividend yield? A fair bit, it appears. The stock in question is the Russian miner and steel manufacturer Evraz (LSE: EVR). For any investor who likes good dividends, it needs no introduction. 

Evraz has an eye-popping dividend yield

The stock has the biggest dividend yield among FTSE 100 stocks right now, a huge 15.5%. And as per recent AJ Bell research, it will continue to reward investors with the high dividend yields even during 2022. Slated to be at an even higher 17.2%, it is followed by BHP at a significant distance, with an expected yield of 10.6%.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

We’re sharing the names in a special FREE investing report that you can download today. And if you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio.

Click here to claim your free copy now!

Moreover, it has a really low price-to-earnings (P/E) ratio of 7.7 times, compared to 18 times for the FTSE 100 index as a whole. This suggests that its share price could rise over time. That is, unless investors are on to something, and have priced in a correction. 

What could go wrong with the FTSE 100 stock

I suspect that could be the case, considering that prices of industrial metals are forecast to be lower this year compared to last. This is likely to impact their earnings. Besides this, higher taxes on metal companies in Russia could also prove to be a drag on them. 

The stock has other weaknesses too. Its dividends, while impressive, have been inconsistent. The company has cut them four times in the past decade. This to me suggests that more cuts are likely in the near future, especially going by the less than bullish forecast for its earnings. In fact, considering that the company has a dividend cover of 1.3 times, which is already low, if its earnings fall it will quite likely be unable to sustain these payouts. In other words, as an investor in the stock, not only should I brace for a lower dividends from the stock, but also a continued muted share price. 

The upside

There could be other reasons to buy the stock, though. If the recovery picks up pace, commodity companies might still be gainers. Also, the stock’s price has fallen from the steep highs we saw earlier last year. So, if I expect an improvement in its prospects, this might be a good time to buy it before the stock starts rising again.

In fact, analysts’ estimates compiled by the Financial Times show an expected 7.4% increase in its share price over the next year. Some of the more optimistic analysts even expect a huge 67.4% increase in it! These are subject to change, of course, as the conditions around us evolve. But they do indicate the potential trajectory for the stock.

What I’d do

I have already bought the stock, and it has given me no reason to complain so far. But I am not sure I want to buy more of it right now. I would like to wait for its next update and its outlook to get a better sense of where the stock might head over the next year. In the meantime, I’m considering buying these stocks. 

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic…

And with so many great companies still trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down…

You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm.

That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away.

Click here to claim your free copy of this special investing report now!


Manika Premsingh owns shares of Evraz. 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.

Is the Rolls-Royce share price a long-term bargain?

It doesn’t take a genius to say that we’re living in strange times at the moment. Take investing as an example. I like to think I have a good nose for a bargain, but are current market conditions and general uncertainty making me doubt my own judgement? Have a look at Rolls-Royce (LSE:RR). In normal times, I would see the Rolls-Royce share price as nothing but an amazing long-term bargain. Why is is that I have doubts now?

Back in 2018, Rolls-Royce traded at a high of 375p. It now trades at around the 125p-130p mark. A very simplistic starting point is to ask myself whether or not I feel Rolls-Royce is genuinely a third of the company it was back then.  

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

We’re sharing the names in a special FREE investing report that you can download today. And if you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio.

Click here to claim your free copy now!

Pandemic struggles hit the Rolls-Royce share price

The Rolls-Royce share price tanked at the start of the pandemic, along with many other companies, but it actually hit its lowest spot in October 2020. Rolls-Royce revenues were hit hard by reduced airline flying time, with the company producing and maintaining aircraft engines for fleets across the world. Reduced flying time continues of course around the world and this is bad for the Rolls-Royce business. Old aircraft engines don’t need replacing as often because they haven’t been used. Existing engines don’t need servicing as often either.

There is room for cheer on that score, though. Increased confidence in airline stocks since the markets reopened this New Year reflect a level of optimism not seen in the airline industry in the past couple of years. This is good for Rolls-Royce, which will find demand for its services increasing over the medium to long term.

The problems Rolls-Royce have faced mean that there is no prospect of a dividend in the near future. A dividend cannot be paid until at least 2023 owing to loan agreements. This is clearly a negative point. However, it could be that the lack of dividend is pinning the share price down at an artificially low level. Reintroducing a dividend when the time is right should – all things being equal – give the Rolls-Royce share price a nice kick in the right direction. 

Huge barriers to entry could mean a bargain

There is more to the longer-term prospects of Rolls-Royce than just the international travel market picking up again. Longer term, Rolls-Royce retains a very strong position within its industry. Rolls-Royce has few competitors thanks to barriers of entry bigger than the engines it produces, so if it can weather the current storm, the relative safety of the company looks assured longer term.

Rolls-Royce has done plenty in 2021 to restructure and streamline in order to protect cash flow. Besides the aforementioned loans, the company also has reliable revenue coming in from government defence contracts.

All things considered, I should probably trust my judgement and be confident in saying that the Rolls-Royce share price is a longer-term bargain. If I do get involved, I will get involved knowing I am in it for the long haul.

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Garry McGibbon has no position in the stock 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.

3 FTSE 100 stocks that could see double-digit dividend growth in 2022

As a rule, when investing in FTSE 100 stocks to earn a passive income, I like to consider dividend yields. These represent the likely return on my investment over the next year or so. This yield changes all the time, of course, because the broader macro environment might shift for better or for worse. And individual companies’ conditions could alter too, leading to fluctuations in both dividends and share prices. Still, it is a starting point that I believe can help me earn a targeted level of passive income in the next three to five years. 

Why dividend growth is important

But, if I am looking at long-term investments, it is a good idea to consider dividend growth as well. This is because it turns out that some of the best FTSE 100 dividend investments over the past decade have been stocks that grew dividends fast, not necessarily those with the highest yields. In this context, I thought of considering three stocks that could show double-digit dividend growth in 2022 when planning my investments. 

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

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Interestingly, two of them are financial services stocks. These are London Stock Exchange Group is expected to show the highest increase of 15.7% as per recent research by AJ Bell. This is followed by the asset manager Intermediate Capital Group, which is expected to see a 14.3% rise. The only non-finance FTSE 100 stock here is the industrial equipment rentals’ provider Ashtead, which is likely to show a 12.5% increase.

FTSE 100 companies’ earnings rise

However, I am assuming that this will happen only if the companies continue to see earnings’ growth. Because if they do not and dividends are still increased, the dividend cover would fall. And I am not sure if that would be considered a prudent decision by investors. So would their earnings increase? 

I am optimistic that it might be the case. All three are cyclical stocks, which means they are likely to show better performance during periods of economic upturn. With recovery expected to continue this year, they could continue to make gains. 

What I’m wary of

If I had to be wary, though, London Stock Exchange would top the risky stocks list. Its big acquisition of Refinitiv seems to have spooked investors and its price-to-earnings (P/E) at a huge 80 times, takes away from its attractiveness right now too. 

Ashtead fares much better when it comes to its P/E, which is 30 times. But it is still higher than the 18 times for the FTSE 100 index as a whole. Moreover, much of its revenue comes from the US. While the country is recovering, the Build Back Better bill remains under peril, which could impact the company’s prospects. Still, it has managed impressive growth over time, so it could continue to do so in the future as well. 

What I’d do now

I think the best of the three stocks is Intermediate Capital Group. It has a P/E of 15 times, which is lower than that for other stocks. It is of course possible that its investments might not do as well next year or even the year after, but so far it appears that things are going in its favour. If I had to buy one, it would be my pick of the lot. 

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic…

And with so many great companies still trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down…

You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm.

That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away.

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Manika Premsingh 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.

5 fantastic & fascinating facts about Apple stock (AAPL)!

Without doubt, Apple (NASDAQ: AAPL) is the most successful company in modern financial history. Today, its market valuation, revenues, cash flow, and earnings are among the highest of any company ever. What’s more, owners of Apple stock have made more money in total than any other group of shareholders in history. So here are five fantastic and fascinating facts about the world’s biggest Big Tech company.

1. Apple stock was briefly worth $3trn

Exactly a week ago, on 4 January, Apple stock soared to an all-time record. At its intra-day high, the Apple share price peaked at $182.94, before easing back to close at $179.70. At its peak, Apple’s market value exceeded $3trn. This made it the world’s first company to reach this jaw-dropping valuation. However, Apple’s stock price has since retreated and stands at $171.25 as I write. This values the consumer-electronic Goliath at $2.8trn, which still makes it the #1 corporation worldwide by market value. Mind-blowing, huh?

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

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2. AAPL is worth more than the German stock market

It took Apple more than four decades to become a $1trn company, hitting this mark in August 2018. With two years, on 19 August 2020, it first reached a $2trn valuation. Earlier this month, it first hit hit the $3trn mark. Even after losing $200bn of market value in a week, Apple at $2.8trn is worth slightly more than the entire German stock market. The total value of all German-listed companies is around $2.4trn, which Apple’s value exceeds by roughly $400bn. Wow.

3. $1,000 in Apple stock five years ago is now worth nearly $6,000

Five years ago, on 13 January 2017, the Apple stock price closed at $29.76. Today, at $171.25, it is over 5.75 times as much. In fact, had I invested $1,000 in Apple stock five years ago, I would have over $5,754 today. That’s a market-thrashing return of 475.4% in five years — and this ignores all cash dividends paid by Apple to shareholders since January 2017. Crikey.

4. Apple took under 16 months to add $1trn in market value

It took Apple 42 years to reach a $1trn market value and two years for this to double. Remarkably, despite the ongoing Covid-19 global pandemic, it took Apple stock less than 16 months to add another $1trn to its already-towering valuation. Clearly, the old City of London saying that “elephants don’t gallop” doesn’t applied to Apple — at least so far. Crazy.

5. Apple’s earnings multiple has almost quadrupled in five years

Now for a slightly frightening fundamental figure from Apple. As a consumer-goods powerhouse, Apple’s fundamental ratings have soared in recent years. Five years ago, the ratio of Apple’s enterprise value (market value plus net debt) to revenues was a healthy two times. Today, this valuation measure has almost quadrupled to nearly eight times revenues. Also, Apple’s price-to-earnings ratio now exceeds 30 times, compared to roughly 10 times five years ago. In other words, Apple’s revenues and earnings have never been as highly valued as they are in 2022. Ooh.

I would not buy Apple stock today

Finally, I don’t own Apple stock, but would I buy AAPL at its current lofty valuation? I would hate to bet against the world’s most successful company, but I expect stock markets to have a weak 2022. Hence, I’d rather look for value among lowly rated FTSE 100 stocks paying juicy dividends. I would rather bet on value than backing go-go growth stocks as global interest rates creep up!


Cliffdarcy has no position in any of the shares mentioned. The Motley Fool UK has recommended Apple. 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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