I believe a retreat from recent record highs represents a fresh opportunity to pile into Close Brothers Group(LSE: CBG).
The merchant banker announced last month that it had enjoyed "strong profitability" across all three of its divisions during February-April. At its core Banking arm the loan book has increased 2.3% in the quarter, and was up 4.1% in the year to date, at £6.7bn.
The company noted that "performance was particularly good in Property Finance" and, while growth was described as "more modest" at its Retail Finance and Commercial Finance wings, its broad resilience should calm even the most jittery of investors.
The City expects earnings at Close Brothers to flatline during the year to July 2017, putting an end to the company's rich record of steady earnings growth. However, this is likely to prove a rare anomaly, with Close Brothers expected to get moving again with a 3% advance next year.
So the number crunchers see no reason for Close Brothers' progressive dividend policy to grind to a halt and, indeed, they expect the financial goliath to raise last year's 57p per share payout to 59.7p this year, and to 62.7p in fiscal 2018. As a result Close Brothers boasts chunky yields of 3.8% and 4% for this year and next.
And despite this year's anticipated earnings drop, Close Brothers remains an appealing value pick, the firm dealing on a mega-cheap forward P/E ratio of 12.4 times.
Raise a glass
While fears persist for the health of the UK's pub chains, I reckon Marston's (LSE: MARS) has what it takes to hurdle rising cost pressures and the impact of galloping inflation on drinkers' wallets.
The Hobgoblin brewer announced last month that underlying revenues rose 3% during the six months to April 1, the top line continuing to rise in spite of the steady erosion in Britons' spending power. The huge investment Marston's has made in its property portfolio continues to deliver the goods and, with further site openings on the horizon (23 pubs and bars and eight lodges are planned in the current fiscal year alone), I expect the top line to keep on buzzing.
And Marston's is also taking steps to enhance its hugely-popular brewing business, the ale giant snapping up Bombardier and Youngs manufacturer Charles Wells this month for £55m. The business saw revenues from its beers rise 1.9% in the first half as its labels continued to grab share from their rivals.
City analysts share my optimistic take and expect earnings to advance 2% and 6% for the years to September 2017 and 2018 respectively. And current projections make Marston's brilliant value, in my opinion (a prospective P/E multiple of 9.3 times falls below the bargain threshold of 10 times).
These growth estimates are expected to keep driving dividends skywards too. For fiscal 2017 Marston's is anticipated to pay a 7.6p per share dividend, up from 7.3p last year and yielding 5.8%. And the good news does not stop here, a 7.9p reward predicted for next year yielding a fearsome 6%.
I reckon both Marston's and Close Brothers are great value bets for growth and income chasers.
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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. 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.