H&T Group PLC (AIM:HAT) got an upgrade to its profit and dividend per share (DPS) forecasts from Shore Capital after a strong set of interim results.
The house broker had expected to raise profit before tax guidance for the full year by between 15%-20% and, after the half-year numbers, has fine-tuned that to a roughly 18% increase to £18.7mln.
Additionally, dividends are expected to grow over the next three years to 27p by 2024, representing a payout ratio of roughly 40%.
As a result, the broker increased its ‘fair value’ estimate to 470p from 430p, although it did not provide a recommendation given it is a house stock.
Earlier today, H&T announced a 42.6% increase in profits for the first six months, underpinned by its core pawnbroking business and a return in demand for gold and foreign currency.
The UK's largest pawnbroker, which was founded 125 years ago, achieved a pre-tax profit of £6.7mln in the first half to 30 June 2022, compared with £4.7mln in the same period last year, on revenue of £77.7mln, up from £52mln.
The core pawnbroking business saw 27% growth in the pledge book to £85.1mln, with demand for pledge lending at record levels.