Consumer services and durables companies’ performance is generally driven by the economic cycle. Companies such as Moss Bros Group and ScS Group offer goods and services that are luxuries, instead of absolute necessities, such as entertainment and gambling. During times of growth, consumers tend to make more discretionary purchases which will drive these companies’ profitability. Higher profits by and large lead to higher dividend payout so economic growth is an opportune time to benefit from these consumer stocks. Below is my list of huge dividend-paying stocks in the consumer cyclical industry that continues to add value to my portfolio holdings.
Moss Bros Group plc (LSE:MOSB)
MOSB has a sumptuous dividend yield of 8.50% and pays 75.10% of it’s earnings as dividends , with an expected payout of 102.50% in three years. While there’s been some level of instability in the yield, MOSB has overall increased DPS over a 10 year period from UK£0 to UK£0.04. When we compare Moss Bros Group’s PE ratio with its industry, the company appears favorable. The GB Specialty Retail industry’s average ratio of 13.5 is above that of Moss Bros Group’s (8.8). More on Moss Bros Group here.
ScS Group plc (LSE:SCS)
SCS has an appealing dividend yield of 7.00% and the company has a payout ratio of 51.76% , and analysts are expecting the payout ratio in three years to hit 67.67%. SCS’s dividend alone will put you better off than your bank interest, but the company’s yield isn’t only higher than the low risk savings rate. It’s also amongst the market’s top dividend payers. ScS Group’s earnings per share growth of 25.08% over the past 12 months outpaced the gb specialty retail industry’s average growth rate of -4.78%. More on ScS Group here.
Shoe Zone Plc (AIM:SHOE)
SHOE has a sumptuous dividend yield of 5.91% and is currently distributing 64.70% of profits to shareholders . With a yield above the savings rate, bank account beating investors will be happy, but perhaps even happier knowing that SHOE is in the top quartile of market payers. More detail on Shoe Zone here.
For more solid dividend paying companies to add to your portfolio, explore this interactive list of top dividend payers.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.