2 hot value stocks for growth and dividend hunters

Ten pound notes

Investor appetite for Acal (LSE: ACL) shows no signs of slowing down. Just today the electronics play hit new record tops north of 300p per share, taking total gains during the past three months to 29%.

This comes as little surprise as sales volumes accelerate and Acal banks the benefits of sterling’s slide.

The business saw revenues glide 18% higher in the year to March 2017, it advised last month, to £338.2m. On an organic basis revenues rose 6%, the small-cap witnessing improving sales and order growth as the year progressed.

And Acal’s record order book of £109m as of March — up 22% at real exchange rates or 13% organically — suggests that revenues should continue to pound higher.

Profits hero

It comes as little surprise that the City expects Acal’s long-running growth history to continue with earnings rises of 8% in the years to March 2018 and 2019 respectively.

As a consequence, Acal changes hands on a forward P/E ratio of just 14.1 times, falling comfortably within the widely-considered value territory of 15 times or under. This is striking value given Acal’s improving momentum.

Those seeking access to hot dividend growth dynamos need to give special attention to the Guildford firm too. Last year’s 8.5p per share is anticipated to march to 9.3p in the present period, and to 9.7p during fiscal 2019.

Subsequent dividend yields clock in at a very-handy 3.1% and 3.2% for this year and next. And I expect shareholder rewards to keep marching higher in line with profits.

A terrific all-rounder

I believe Countryside Properties (LSE: CSP) is another London lovely trading far, far too cheaply right now.

For the 12 months ending September 2017 a 65% earnings surge is predicted, leaving the housebuilder dealing on a prospective P/E multiple of 12.8 times. And Countryside is expected to keep punching beyond the present period, a further 27% bottom-line increase expected in fiscal 2018.

A sub-1 PEG ratio of 0.2 underlines its position as a terrifically-priced growth bet. But there is also plenty for income hunters to get excited about too.

The 3.4p per share dividend shelled out last year is expected to improve to 8.1p in the current year, and again to 10.3p in 2018. As a result, a 2.3% yield for 2017 leaps to 3% for next year.

Fluffy forecasts

The flurry of positive trading updates from across the homebuilding sector has propelled the Brentwood business to fresh record tops in July — it struck a fresh peak above 355p per share just last week.

The FTSE 250 giant itself advised in May that trading during October-March had exceeded its expectations, the number of completions registered in the period exploding 31% to 1,437 units. And Countryside’s private forward order book shot 69% higher to £347.1m, soothing fears of a demand drop-off as the British economy stagnates.

The mortgage rate war being fought out by the country’s lenders is helping to keep housebuyer interest on the boil, as is the government’s Help to Buy purchase scheme. And a failure by successive administrations to remedy the UK’s chronic accommodation shortage is helping to keep property values well supported.

So with the supply/demand crunch set to persist long into the future, I reckon Countryside should prove a lucrative stock for value hunters.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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