A rapidly-expanding continental footprint convinces me that Arrow Global(LSE: ARW) should deliver excellent shareholder returns in the years ahead.
A healthy uptick in collections last year saw revenues at the debt manager jump 42.6%, to £235.9m, a result that powered underlying post-tax profit 28.7% higher to £45.6m. Aside from its operations in the UK, Arrow Global now has a foothold in France, Portugal and the Netherlands, and is set to enter the Italian market in the coming months.
The City expects earnings to keep taking off at the finance specialist as sales stream in across these regions. Growth of 26% and 18% is expected for 2017 and 2018 respectively, leaving Arrow Global dealing on a prospective P/E multiple of 9.8 times.
And the prospect of a swelling top line is also expected to keep driving dividends skywards, resulting in dividend yields of 3.4% and 4.1% for this year and next.
Demand for BAE Systems (LSE: BA) stock has continued to surge in recent weeks, its role as one of the world's biggest defence contractors attracting waves of safe-haven buying.
And I expect appetite for the weapons-to-cyber-security firm to remain white-hot in the months and years ahead as nations across the globe build up their arsenals.
President Trump's pledge to go on a hardware-buying spree, combined with demands for NATO countries to boost their own defence budgets, marks the latest steps in the rhetorical battle between the West and geopolitical rivals like Russia and China. These are developments which should keep arms spending on an upward trail.
The abacus movers expect this backdrop to deliver a period of sustained earnings growth at BAE Systems, and they anticipate expansion of 9% this year and 7% in 2018 alone. These projections leave the manufacturer dealing on a forward P/E rating of 14.5 times, below the benchmark of 15 times broadly considered to be attractive value.
And BAE Systems also delivers a tasty treat to income seekers, the firm offering up a 3.5% dividend yield for 2017 alone.
While business activity at Royal Mail (LSE: RMG) has been smacked by Brexit-related issues more recently, I am convinced the country's oldest courier remains a terrific selection for long-term growth investors.
In particular, I reckon Royal Mail should thrive as the internet shopping phenomenon explodes and drives parcels traffic skywards. While slowing from recent months, latest data from the British Retail Consortium still showed UK non-food sales made in cyberspace cantering 8% higher in February from the same month last year.
Royal Mail is expected to suffer some earnings woe as the aforementioned economic trouble weighs on the UK. The firm is anticipated to endure dips of 3% and 1% in the years to March 2017 and 2018 respectively, before getting back to growth with a fractional rise in the following year.
However, a forward P/E ratio of 10 times is bang on the broadly-considered bargain watermark. And Royal Mail's cash-saving programme should keep dividends growing despite any earnings weakness. Consequently the company sports a gargantuan yield of 5.7% for fiscal 2017 alone.
I reckon now is a great time for long-term investors to pile-in.
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Royston Wild has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.