Investors in Evraz(LSE: EVR) have been through a tough few years as their shares collapsed in value during the commodities sector crunch. But they've come storming back since a low in June 2017, having more than doubled to today's 380p.
An examination of the company's outlook coupled with Thursday's full-year production figures shows why.
The miner and steel producer saw crude steel production grow by 3.8% during the year, with steel product output (net of re-rolled volumes) up 3.2%. And production of coking coal concentrate is up by 6.2%, though saleable coke production fell by 17.9%.
In fact, the firm's output of steel products across the board has been getting back to growth during 2017, as demand from North America has been improving and Evraz's crude steel production volume has risen thanks to the completion in 2016 of repairs to its blast furnaces.
But the exciting news is on prices, with the average selling price of pig iron up by 59% and coke prices up 99% -- and that fed through to price rises for all of Evraz's product categories.
With the company's balance sheet improving, there's a return to dividends on the cards after a few lean years, with an interim dividend of 30 cents per share already in the bag.
That bodes well for the 6.8% yield expected for the 2017 full year, with forecasts suggesting 7% in 2018. And even after the storming share price recovery, we're looking at P/E multiples of only around nine.
Evraz is a stock I'd buy for its long-term dividend prospects (while being mindful of the cyclical nature of commodities markets), but I expect further share price growth too.
With the unfortunate demise of Carillion still such a shock, you could be forgiven for steering clear of the whole construction and outsourcing industry. But if you do, I think you could be missing out on some solid investments.
Galliford Try(LSE: GFRD) is one. Its share price has already been hit by the sector fallout as it, along with Balfour Beatty, is involved in a joint venture with Carillion. Any shortfall in the estimated £60m-£80m needed to finish the project would be shared equally between partners, so there's likely to be some hit.
It's resulted in an 8% share price fall in the past week to 1,180p, but I see that as oversold.
The stock's forward P/E is now under eight -- and that's with 16% EPS growth forecast for the year to June 2018, and a further 11% pencilled in for 2019.
I think that alone makes the shares look good value, especially considering that Galliford Try's earnings have been growing steadily, and I see no reason to suspect that's going to stop any time soon.
Wads of cash
But the real prize is the firm's dividend, which has been strongly progressive in recents years and is expected to yield a whopping 7.7% by June. Cover by earnings of 1.7 times should be fine.
Galliford Try isn't under anything like the debt pressure that helped see off Carillion, with the company actually boasting net cash of £7.2m at its year end on 30 June 2017. And that was an improvement, from net debt of £8.7m a year previously.
With the UK's housing shortage, I can only see the current construction boom continuing -- and I see very attractive long-term dividends here.
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Alan Oscroft 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.