Unilever enjoys solid first-half: Unilever sells household products that most of us use every day. Brand loyalty and a strong market position allows it to push through price increases that match the inflationary pressure on costs that give investors steadily rising profits and dividends. The encouraging signs for the company, that makes everything from Dove soap to Hellmans mayonnaise, was that sales growth in emerging markets accelerated to 6.5% in the three months to the end of June, up from 5.4c in the first quarter. Unilever is the largest ice cream seller in the world. Brands such as Ben & Jerry’s and Magnum should benefit from a heat wave across Europe at the moment and declining prices for raw materials as commodity prices slump. Its cash performance is also impressive with free cash flow up 48% during the first half of the year. The cash supports an excellent track record of regular dividend payments, and the quarterly payout was held at €30.2 cents (21p), ex-dividend 5 August and paid on 9 September. The full-year dividend is expected to increase by about 11% to 124 cents (89.7p), offering a prospective yield of 3%. The shares are highly rated, trading on 22 times forecast earnings. However, investors are willing to pay that premium because of the steady performance and lack of alternative investments that offer a 3% yield that rises above inflation every year. Unilever at £29.05. Questor says “Hold”.
17 Apr '15
A dividend paying share to hold forever: Consumer goods giant Unilever pays steady dividends and has an excellent track record of generating cash. Unilever, which makes Dove soap, Lipton tea and Hellmann’s mayonnaise, said it is starting to see stronger sales growth after developing premium versions of existing brands. Unilever saw total revenues rise 12.3% to €12.8 billion (£9.2 billion) in the three months to the end of March. Most of that jump came from currency movements. Group sales fell by 2.7% to €48.4 billion last year after being dragged down by extremely volatile foreign currency markets, so the change in fortunes is encouraging. Unilever may be struggling with a sluggish performance in developed markets, which contribute 40% of sales, but profits in the year ahead will be helped by falling commodity prices. Mr Huet said that these usually take between four to six months to feed through to the company’s results but will benefit profits “without a doubt” in the second half of the year. The shares are highly rated, trading on 22 times forecast earnings. However, there is a possibility that product prices in Europe could begin to recover following the European Central Bank’s decision to launch a €1.1 trillion quantitative easing programme in January. Meanwhile, falling commodity costs should push profits up faster than sales in the second half. Unilever is a quality company and one that investors should be happy to hold on to. Given the fair winds expected in the year ahead, we maintain that long-term recommendation. Unilever at £30.11+77p. Questor Says “Hold”.
16 Apr '15
Lower £ also helps
The divi is denomd in Euros so our divi will seem even better as the £ falls and at last the £ IS falling,
16 Apr '15
RE: Headwinds turn to Tailwinds
And to think I bought Unilever as my "boring" share! Good morning.
16 Apr '15
Headwinds turn to Tailwinds
and the divi is up by 6% to boot. Whats not to like?
23 Jan '15
Morningstar's Erin Lash take Pt 2
cont ........... In December, Unilever disclosed its intentions to separate its developed market spreads business into a standalone segment, which will be 100% owned by the parent company; however, we don't think this will meaningfully change the business’ prospects. Rather, we think this news signals the business is noncore, despite management’s commentary to the contrary, and could eventually lead the firm to cut ties with this flagging segment, in line with recent efforts. - See more at: http://www.morningstar.co.uk/uk/news/133410/unilever-retains-economic-moat.aspx#sthash.3e0oK0SP.dpuf
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