The dividend yield is not a great indicator of a company's value or earnings outlook, despite the understandable keen interest of investors in a low interest rate environment. But, although companies with healthy earnings outlook do not usually pay a dividend yield that is likely to be attractive to yield investors, the rewards may come over time.
Bapcor Ltd (ASX: BAP) is one of Australia's largest suppliers of car parts and accessories. The company's presentation at the Macquarie conference last week revealed the plans of remaining a trade focused parts supplier, a specialist wholesaler, a premium retailer of automotive accessories and expansion into Asia. The shares are trading on a forward price-earnings ratio (PER) of 27x. JBWere has forecast 9% per annum (pa) three year earnings per share (EPS) compound annual growth rate (CAGR). Annual earnings guidance by the company is 30% net profit growth.
Treasury Wine Estates Ltd (ASX: TWE) is a global winemaking and distribution company controlling two of the five most popular wine labels in Australia; Penfolds and Wynns. The shares are trading on a forward PER of 41x, which is a little expensive, but supported by continuing strong export growth to Asia (China) as well as substantial growth in its other markets, Australia and New Zealand, Europe and USA. JBWere has forecast three year EPS CAGR of 15% pa.
Aristocrat Leisure Limited (ASX: ALL) is one of the world's leaders in gaming machines and systems' development, assembly, sale, distribution, and servicing here and internationally. The company's presentation at the Macquarie Conference recently was upbeat but measured, indicating that the company is ready for its next phase of growth. The share price is at an all-time high, trading on a forward PER of 29x, but further upside is supported by JBWere's forecast of three year EPS CAGR of 11% pa.
