4 Dividend Stocks To look At: BT.A, BP, HSBA, RDSA

4 Dividend Stocks To look At: BT.A, BP, HSBA, RDSA

Dividends stocks are considered good for long term investors with less risk appetite, as these stocks are a regular source of income. Dividend-paying stocks provide psychological comfort to the group of investors who stay invested in the stock, largely ignoring the quoted market values, if their dividend amount gets larger with time. Another benefit of dividend stock is that most of them give investors the option to invest the dividends back into the company, for cumulative earnings. Here are insights of four dividend stocks to bet on for longer time horizon.

Comparative chart for BT.A, BP, HSBA, RDSA

(Source: Thomson Reuters)

BT Group

BT Group Plc (BT. A) is a London based communication services organisation. The company’s services portfolio consists of managed networked IT services, fixed voice and data, mobility, television, connectivity, and broadband services. It also offers copper and fibre connections between exchanges, homes and businesses. The company has business existence across Asia-Pacific, Europe, the Middle East, Africa and the Americas.

Q1 FY2020 Trading Update (as on 2nd August 2019)

In Q1 FY2020, the company’s reported revenue declined by 1% to £5,633 million as compared with the corresponding period of the last year, due to a decrease in consumers, enterprise and Global. Adjusted EBITDA plunged by 1% to £1,958 million against the £1,800 million in H1 FY18, due to higher spectrum fees, content costs and lower revenues, partly offset by a decrease in costs from transformation and restructuring programmes. There was impact of higher upfront interest expenses on the IFRS 16 lease liabilities recognised from 1st April 2019; as a result, the reported profit before tax of the company came in at £642 million and profit before tax (adjusted) at £749 million. Normalised free cash flow was £323 million, posting a decrease of 36 per cent from the comparable period last year, due to an increase in capital expenditure and higher tax and interest payments, partly offset by working capital expended in phases.  Reported capital expenditure increased by 11 per cent to £931 million, driven by the consumer-centric costs and network investments.

BT Group Share Price Performance

Daily Chart as at 12th August 2019, before the market close (Source: Thomson Reuters)

On 12th August 2019, at the time of writing (before the market close, GMT 03:51 PM), BT Group PLC shares were trading at GBX 172.64 and declined by 0.18 per cent as compared with the previous day’s closing price. Stock’s 52-week High is GBX 268.60, and 52-week Low is GBX 171.58. The group’s stock beta stood at 0.87 as on date, reflecting lower volatility as compared to the benchmark index.

In the past 1 year, BT Group PLC shares have delivered a negative return of 24.47 per cent. On a YTD (Year-to-Date) basis, the stock plunged by approximately 27.36 per cent and was down by 17.93 per cent in the last three months with an overall gross dividend yield of 8.90 per cent.

The company has been consistent in paying dividends to investors. In the last seven years, the company’s highest dividend yield has been of 6.91 per cent (FY19), while its lowest has been of 2.83 per cent (FY15). The mean annual dividend yield was around 4.4 per cent in the past seven years.

BP Plc

BP PLC (BP) is a British oil and gas company; deals in exploration and production activities of oil and natural gas and is into refining, distribution & marketing, petrochemicals, power generation and trading.

Financial Highlights for first half FY19 ($, million)

In H1 FY19, the company’s total revenue was recorded at $141,154 million as against $146,050 million in H1 FY18. The company’s revenue declined due to the lesser revenues from it’s Downstream business for the period. The company’s revenue in Q2 FY2019 stood at $73,747 million versus $76,907 million in Q2 FY2018. The company’s profit before tax and interest was recorded at $9,680 million for H1 FY2019 versus $10,051 million in H1 FY18. The PBT (Profit before tax) for H1 FY19 stood at $7,930 million as against $8,901 million in H1 FY18. The company’s profit for the period was recorded at $4,903 million for H1 FY19 versus $5,404 million in H1 FY18. The company’s profit for the period attributable to the shareholders was recorded at $4,756 million for H1 FY19 versus $5,268 million in H1 FY18. The company’s basic earnings per share for H1 FY19 stood at 23.47 cents as against 26.42 cents in H1 FY18. The company’s diluted earnings per share for H1 FY19 stood at 23.35 cents against 26.27 cents in H1 FY18.

BP PLC Share Price Performance

Daily Chart as on 12th August 2019, before the market closed (Source: Thomson Reuters)

On 12th August 2019, at the time of writing (before the market close, GMT 03:57 PM), BP PLC shares were trading at GBX 504, up by 0.21 per cent as compared with the previous day’s closing price. Stock’s 52-week High is GBX 603.60, and 52-week Low is GBX 481.35. The group’s stock beta stood at 1.43 as on date, reflecting higher volatility as compared to the benchmark index.

In the past 1 year, BP PLC shares have delivered a negative return of 10.90 per cent. On a YTD (Year-to-Date) basis, the stock surged by approximately 1.4 per cent and was down by 4.30 per cent in the last three months with an overall gross dividend yield of 6.75 per cent.

The company has been consistent in paying dividends to investors. In the last seven years, the company’s highest dividend yield has been of 7.67 per cent (FY15), while its lowest has been of 4.52 per cent (FY13). The mean annual dividend yield was around 5.86 per cent in the past seven years.

HSBC Holdings Plc

HSBC Holdings PLC (HSBA) is a London, United Kingdom-headquartered banking and financial services organisation. It offers a wide range of products and services, with business spread across Asia, Europe, the Middle East, North Africa, North America and Latin America.

Financial Highlights – H1 FY19

The company’s reported revenue stood at $ 29,372 million in H1 FY19 as against $ 27,287 million in H1 FY18. The company’s reported PAT surged by 18.1 per cent to $9.9 billion in H1 FY19. The company’s reported PBT surged by 15.8 per cent to $12.4 billion compared to the prior year-ago period. The company’s EPS stood at $0.42. The company’s adjusted PBT surged by 6.8 per cent to $12.5 billion compared to the corresponding prior-year period.

HSBA Share Price Performance

Daily Chart as at 12th August 2019, before the market closed (Source: Thomson Reuters)

On 12th August 2019, at the time of writing (before the market close, GMT 04:12 PM), HSBC shares were trading at GBX 612.9 and slipped 1.46 per cent as compared with the previous day’s closing price. Stock’s 52-week High is GBX 722.70, and 52-week Low is GBX 596.40. The group’s stock beta stood at 0.98 as on date, which indicates almost the same in volatility as compared to the benchmark index.

In the past 1 year, HSBC shares have delivered a negative return of 14.30 per cent. Also, on a YTD (Year-to-Date) basis, the stock plunged by approximately 3.85 per cent and was down by 4.59 per cent in the last three months with an overall gross dividend yield of 6.74 per cent.

The company has been consistent in paying dividends to investors. In the last seven years, the company’s highest dividend yield has been of 6.45 per cent (FY15), while its lowest has been of 4.28 per cent (FY12). The mean annual dividend yield was around 5.38 per cent in the past seven years.

Royal Dutch Shell PLC

Royal Dutch Shell PLC (RDSA) is a Hague, Netherlands-based international group of energy and petrochemical company, which engages in exploring, producing, refining and marketing oil and natural gas. The company explores for natural gas and crude oil globally, in conventional fields and from other sources, such as coal formations, tight rock and shale. The group also produces and markets chemicals.

Recent News

The company announced dividend (interim) of US$ 0.47 (for Class A & B shares) in Q2 FY19.

Financial highlights for FY19

The company’s income stood at $9,319 million in H1 FY19. The company’s cash balances stood at $18,470 million in H1 FY19. The company’s long-term debt stood at $76,029 million in H1 FY19.  The company’s revenue surged to $90,544 million in Q2 FY19 as against $83,735 million in Q1 FY19.

RDSA Share Price Performance

Daily Chart: 12th August 2019, before the market closed (Source: Thomson Reuters)

On 12th August 2019, at the time of writing (before the market close, GMT 04:16 PM), RDSA shares were trading at GBX 2,381.5 and were by 0.35 per cent as against the previous day’s closing price level. Stock’s 52-week High is GBX 2,811.38 and 52-week Low is GBX 2,209.50. The group’s stock beta as on date stood at 0.89, reflecting lesser volatility as compared to the benchmark index.

In the past 1 year, RDSA shares have delivered a negative return of 7.41 per cent. On a YTD (Year-to-Date) basis, the stock has surged by approximately 2.84 per cent and was down by 1.80 per cent in the last three months with an overall gross dividend yield of 6.16 per cent.

The company has been consistent in paying dividends to investors. In the last seven years, the company’s highest dividend yield has been of 8.21 per cent (FY15), while its lowest has been of 5.02 per cent (FY12). The mean annual dividend yield was around 6.11 per cent in the past seven years.