Will FTSE 100-listed safety equipment company Halma PLC (LSE:HLMA) deliver its 45th consecutive 5%-plus dividend increase in its upcoming full-year earnings print?
The 130-year-old Amersham-based group may not be among the sexiest of the blue-chip index’s constituents, but its investment thesis is airtight.
“The mandatory nature of investment in this area creates consistent business flows and sticky customers, a combination which gives Halma a degree of pricing power,” AJ Bell analysts wrote in a recent research note.
“That in turn can mean high margins, good returns on capital, strong free cash flow and a growing dividend for investors over the long term.”
Analysts predict a 21.57p-per-share payout from the dividend hero, representing an increase of 7% sequentially.
“If this forecast is met, that would be Halma’s forty-fifth consecutive increase in its annual dividend of 5% or more,” said AJ Bell.
It would also keep Halma in the elite bunch of companies that have managed to increase their annual dividend each and every year for at least a decade.
Only 18 FTSE 100 firms can say that.
Halma is expected to post a 7% top-line sales increase to £2 billion, with management targeting an operating margin between 18% and 22%.
“And for pre-tax profit, analysts are looking for a 15% advance to £336 million from £291 million on a stated basis, with the adjusted number coming in at £389 million (up from £361 million),” added AJ Bell.