Today I’m discussing two top income shares to snap up for 2020 (and beyond!).
I’d argue that getting access to gold prices would be a good idea ahead of what could be a politically- and economically- turbulent 2020. And one great way to do this is to buy shares in producers of the precious metal as investors here can see the value of their investments track movements in bullion prices whilst getting hold of some chunky dividends, too.
One great way to play this theme is by buying Polymetal International, in my opinion. News on the production front here has been pretty positive recently thanks to better-than-expected production at its mega Kyzyl facility in Siberia, group output rising 7% in the last quarter to 476,000 ounces. And operational updates on the asset continue to impress, the FTSE 100 firm this week upgrading its reserve estimates a whopping 18% to 8.5 million ounces and extending the life expectancy of the mine as well.
City analysts expect Polymetal’s earnings to balloon 29% in 2020, leaving it trading on a forward P/E ratio of just 9.9 times. Throw a bulging 5.1% dividend yield into the bargain too and I reckon it’s a top blue chip to load up on today.
Marketing products maker 4Imprint Group doesn’t offer up the same sort of yields as Polymetal — for 2020 this sits at a healthy-if-unspectacular 3.3% — though the rate at which it continues to hike annual dividends makes it worthy of serious attention from income chasers.
The ordinary payout in 2018 leapt 25% to 42.58p per share, though this wasn’t the only reason for shareholders to celebrate as it shelled out a special dividend of 43.17p for the period on top of this. The FTSE 250 company’s decision to supercharge the interim dividend in the current year (up 29% year on year to 20.52p) bodes well for another year of explosive payout growth.
4Impint’s been able to light a fire under dividends for donkeys’ years now, reflecting a combination of brilliant double-digit earnings growth and scintillating cash generation. As of late June the company had a whopping $42.7 million worth of cash on the books versus $26.5 million a year earlier, a testament to the benefits of its direct marketing business model and the steps it’s taken recently to supercharge sales through heavy brand investment.
City analysts expect 4imprint to lift the dividend to 64.2p ordinary dividend in 2019 and to hike it again to 83.2p in 2020, underpinned by expectations of more brilliant bottom-line growth in that period (including a 12% rise next year). And latest trading details released this month should convince investors of its exceptional momentum, the firm advising that “demand activity in the second half has remained robust, with growth in both new and existing customer orders consistent with that seen in the first half.” Organic revenues rose 16% between January and June.
And with its expansion of its Oshkosh distribution facility finally completed in September 4Imprint will be in a better position to service soaring orders from its ever-expanding consumer base. At current prices this stock carries a heavy forward P/E ratio of 22.1 times, though I think this paper valuation is merited given the rate at which turnover is booming.