6 Rising Income Stock Picks from Evenlode

Evenlode's Hugh Yarrow reveals six stock picks which continue to generate healthy levels of spare cash and have the ability to sustain healthy current dividend payments

External Writer 1 June, 2017 | 1:52PM

Morningstar's "Perspectives" series features investment insights from third-party contributors. Here, Hugh Yarrow, manager of the Evenlode Income fund shares, his favourite cash compounding stocks.

Gently rising stock markets feel more enjoyable than falling ones, but they also tend to result in less compelling valuation opportunities. However, we believe reasonable returns remain available for the patient, careful investor. Also – importantly – we remain very reassured by the health and development of free cash flow for our aggregate portfolio.

We view this free cash flow stream as a key safety buffer for both the portfolio’s current and future dividend flow. We, therefore, think carefully about free cash flow, both in terms of how much is being generated by a business at present, but also the potential for free cash to develop over coming years, and how resilient it might be in less favourable economic conditions.

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Diageo PLC3,230.00 GBX0.17
Informa PLC596.00 GBX1.29
PageGroup PLC549.50 GBX0.27
PepsiCo Inc144.16 USD1.30
Sage Group (The) PLC644.00 GBX-0.19

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