2 small-cap dividend stocks you must check out today

Moss Bros
Moss Bros

I am confident that Forterra(LSE: FORT) should prove a lucrative share selection in the years to come thanks to the strength of the residential construction market here in the UK.

The masonry product play saw revenues dance 11.4% higher between January and June, to £162.7m, the company reporting a "double-digit increase in brick and block revenue" thanks to "good demand from the new-build residential market." As a result pre-tax profits (before exceptional) moved 3.3% higher to £31.4m.

Despite facing the challenges of a rising cost base, Forterra is successfully passing these costs on to its customers. And the Northampton firm is expanding in other areas to give the bottom line an extra kick, it having snapped up precast concrete flooring specialist Bison Manufacturing for £20m last month.

Build a fortune

City brokers share my optimistic take on Forterra's earnings potential and expect it to record earnings advances of 9% and 10% in 2017 and 2018 respectively.

Such projections, allied with exploding cash flows, are expected to keep dividends marching on. The 5.8p per share reward of last year is anticipated to explode to 9.2p in the present period, driving the yield to a very handy 3.3%.

And the forecasted 10.2p dividend for 2018 means that the yield rises to an even better 3.7%.

A smart choice

Moss Bros (LSE: MOSB) is another small-cap dividend star I believe all savvy investors need to check out today.

The suiter-and-booter, supported by a predicted 4% earnings rise, is predicted to pay a 6.2p per share dividend in the year ending January 2018, up from 5.89p in the previous period. And this projection means Moss Bros sports a titanic 6.7% yield.

And the good news does not end here. In fiscal 2019 the firm is predicted to pay a 6.5p reward, assisted by an estimated 6% bottom-line rise and yielding a mighty 7%.

Striding skywards

Moss Bros has seen its share price rupture in recent months, a steady slew of worrying data from the high street prompting share pickers to march toward the exits. The retailer has seen its share price sink 23% since the end of May.

But I see this weakness as a fresh buying opportunity as sales at the London-based business continue to move northwards. Whilst Moss Bros is clearly not immune to the headwinds created by the rising pressure on shoppers' wallets, I am confident the massive investment it has made both online and in-store will pay off.

Moss Bros saw like-for-like sales in-store and online rise 5.5% during the first 15 weeks of the current financial year.

Internet sales shot 14.7% higher during the period. Furthermore, the business also noted that "[our] new format stores continue to trade ahead of non-refitted stores and are on track to achieve their anticipated payback targets." And its re-fitting programme still has plenty left in the tank, with 28 of its 129 outlets still awaiting a fresh lick of paint.

With its multichannel approach clearly delivering the goods, I am confident Moss Bros -- like Forterra -- has what it takes to keep delivering meaty earnings and dividend growth for years to come.

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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

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