While I'm not a devoted follower of Neil Woodford, I believe the investment guru may be onto a winner with his endorsement of information technology star Softcat (LSE: SCT).
And my bullish take on the FTSE 250 share was reinforced by a robust trading commentary released on Wednesday.
Softcat, which supplies IT infrastructure to both corporate and public sectors, said "customer demand has remained strong across all segments" during the three months ending October and that the company again delivered profitable growth.
In a bid to continue building scale the Buckinghamshire-based business announced that it had opened a seventh branch in the quarter on the south coast of England.
The solid performance prompted outgoing chief executive Martin Hellawell to declare: "It's still early days but we are pleased with our good start to FY18 and our expectations for the full year are unchanged. Demand from our customers continues to be strong and we are well-positioned to deliver solutions across their evolving IT infrastructure requirement."
On the charge
Softcat has seen demand for its broad range of services steadily increase in recent years, allowing it to clock up more consistent quarterly growth for more than four years now. And with the computer services giant commanding just over 6% of the value-added reseller (or VAR) market, there is plenty of scope for it to continue growing business.
The City certainly thinks so, and is tipping Softcat to keep earnings growing with a 7% advance in the year to July 2018. This, combined with the firm's ability to throw out boatloads of cash, is expected to keep dividends growing at a splendid rate too.
Current forecasts suggest a 15.1p per share ordinary dividend is in the offing for this year, up from 9p and yielding a chunky 2.8%. And as in previous years, Softcat is in great shape to likely throw out special dividends too.
Investors haven't been piling into it on the back of today's buoyant release and the business was recently trading fractionally lower on the day. However, this should not come as a shock given the impressive share price gains in the run-up to the update.
Indeed, Softcat has gained 29% in value over the past two months alone, taking gains over the past year to a whopping 82%, and is in great shape to add to these advances. In my opinion the tech titan is fully worthy of a premium forward P/E ratio of 23.9 times.
Lend me your ear
Those seeking exciting dividend shares should also have a gander at Morses Club (LSE: MCL) today.
Like Softcat, this one is expected to keep the bottom line growing at a steady-if-unspectacular rate, with earnings rises of 5% and 16% currently predicted for the years to February 2018 and 2019 respectively.
A bargain forward P/E ratio of 11.8 times should make investors sit up and take serious notice. Although undoubtedly dividend projections for the home-collected money lender should rightly grab the headlines -- anticipated rewards of 6.9p and 7.8p per share for this year and next result in gigantic yields of 5.1% and 5.8%.
A steady increase in customer numbers allowed the AIM-quoted business to announce a 14.8% improvement in revenues during March-August, to £54.2m, and its geographic expansion scheme should set it in good stead to keep growing both earnings and dividends at a healthy rate.
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.