You are here: Home - Investing - Experienced Investor - News -

Stock of the week: National Grid

0
Written by: YourMoney.com
05/11/2018
Ian Forrest, investment research analyst at The Share Centre, picks power and gas distribution company National Grid as stock of the week.

In times of volatile markets and uncertain economic prospects, investors are looking for companies that can generate income on a constant basis.

We have long been fans of National Grid for income seekers and the guarantee of dividends rising at least in line with RPI continues to be very appealing to investors. A very nice 5.8% yield at present makes it a good candidate for this week’s stock tip.

Investors interested in the sector will be aware it has been under pressure from politicians and regulators, which has led to an increase in share price volatility over the past two years.

Indeed, earlier this year there was expected news from Ofgem of a tougher regulatory framework that will lower profits from 2021 as a result of what it called “excessive profits” across the sector. These proposals were confirmed in July, impacting the share price.

Nevertheless, prospects for the company’s operations in the US are good and the UK operations remain on track to outperform this year. The group is benefiting from low interest rates on its cost of borrowings, and investors should appreciate that it expects earnings growth at the top end of its 5 – 7% range in the medium-term.

We recommend National Grid as a ‘buy’ for low to medium risk investors geared to an income portfolio.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Five ways to get on the property ladder without the Bank of Mum and Dad

A report suggests the Bank of Mum and Dad is running low on funds. Fortunately, there are other options for st...

The essential Your Money guide to the April 2018 tax changes

As we head into the 2018/19 tax year, a number of key changes take place to existing policies while some new i...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

YourMoney.com Awards 2018

Now in their 21st year, our awards recognise the companies offering the best products and services to consumers

Money Tips of the Week

Read previous post:
Thousands of workers set for real Living Wage pay rise

The Living Wage Foundation has announced a rise in the voluntary pay initiative adopted by employers to up to £10.55...

Close