CARD FACTORY (CARD) 331.6P
Prospective dividend yield: 7.5%
BUDGET GREETINGS CARDSto-gifts seller Card Factory is providing a steady stream of progressive ordinary dividends and special dividends amid inclement retail conditions.
Card Factory’s positive half year update (10 Aug) flagged 3.1% like-for-like sales growth, while its vertically integrated model allows the retailer to maintain strong margins, generate oodles of cash and keep prices low.
Stockbroker Peel Hunt has upgraded its 12-month price target from 400p to 430p, flagging the continuing woes at Clintons, Card Factory’s main competitor, which is shuttering stores.
Card Factory yields 7.5%, based on Peel Hunt’s year-to-January 2018 forecast for pre-tax profit of £87.8m (2017: £85.1m) and a 25p dividend (including an expected 15p special dividend on top of a 10p ordinary payout), rising to £96m and 26p respectively for the financial year ending January 2019. (JC)