These brilliant dividend stocks could be millionaire-makers

financial independence
financial independence

IG Group(LSE: IGG) was trekking northwards again in Thursday business following the release of first quarter results, although arguably a 1% day-on-day rise fails to reflect the impressiveness of its latest trading numbers.

The spread betting player declared that, during the three months to August 31, "client numbers in the UK were, as expected, lower than in the equivalent quarter in the prior year due to the particularly strong new client inflow in the prior period reflecting the short-term trading opportunities created by the EU referendum in June 2016."

Still, IG Group managed to print record revenues of £135.2m in the period, up 21% year-on-year. The FTSE 250 star also saw client numbers increase 9%, to 124,900, and revenues per client grew 11% in the quarter.

Bet on it

I can understand investor reluctance to pile in right now given the regulatory uncertainty hanging over spread betting operators. Indeed, IG Group announced today that "none of the recently announced regulatory changes have adversely impacted the business to date [although] the nature and timing of potential regulatory changes in the UK and some other key markets for the Group remain uncertain."

And those seeking hot growth shares in particular may want to give the stock a wide berth right now with City analysts predicting bottom-line falls of 1% the years to May 2018 and 2019.

But those seeking abundant dividends need to give the company more than a passing glance, in my opinion. The business is anticipated to hike the full-year dividend from 32.3p per share in fiscal 2017 to 33.8p in the present period, and again to 34.7p next year. As a result, it boasts magnificent yields of 5.4% and 5.5% for this year and next.

While there is clearly some degree of uncertainty facing IG Group at present, I reckon a prospective P/E ratio of 13.7 times more than reflects this.

Clothes colossus

N Brown Group (LSE: BWNG) is another London-listed stock expected to deliver better-than-average dividends in the immediate term and beyond.

Despite enduring many years of earnings losses, the affordable and niche (plus-size) clothes retailer has still managed to keep shareholder rewards locked at 14.23p per share. And City analysts do not expect this trend to cease just yet with an identical dividend forecast for the year to February 2018, as well as a 1% profits dip.

This estimated payout yields 4%, beating the average forward yield of 3.5% for Britain's blue chips by a little distance. And with N Brown predicted to finally get earnings marching higher in fiscal 2019, the abacus bashers expect dividends to follow suit. A payout of 14.5p is presently predicted, pushing the yield to a very handsome 4.1%, and supported by an estimated 4% earnings improvement.

The JD Williams and SimplyBe brands owner saw sales increase 5.6% during the 13 weeks to June 3, according to its latest trading statement. The moves it has made to embrace e-commerce are clearly paying off in spades (online sales shot 16% higher in the period) and with rising inflation putting increasing pressure on shoppers' purses, I fully expect demand for N Brown's affordable fashion offer to keep flying.

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Royston Wild has no position in any of the 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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