2 hidden dividend plus growth stocks I'd buy with £2,000 today

While companies in the software business often attract growth investors, I can't help thinking the dividends being paid by Iomart Group(LSE: IOM) are being overlooked by income investors.

The yields are modest, with only 1.8% expected for the year to March 2018. But they're almost three times covered by earnings and, more importantly for long-term income, they're strongly progressive.

From just 1.4p per share in 2013, the Iomart dividend reached 6p in 2017, and there's 6.77p forecast for this year -- and that's massively ahead of inflation.

In fact, if you bought Iomart shares back in March 2013, you'd only have paid around 230p for them. With the price currently around the 370p level you'd be sitting on a 60% gain. But, crucially for income seekers, the forecast dividend for this year would already be yielding almost 3% on your original purchase price -- with 2020 forecasts suggesting 4%.

Results

Results should be out on 12 June, and Thursday's update suggests they're going to be impressive. The cloud computing specialist said it "expects to deliver another strong set of results delivering good growth in both revenue and profit."

Revenue is expected to be up around 9%, with adjusted EBITDA up from £36.6m to approximately £39.8m and adjusted pre-tax profit up from £22.4m to approximately £23.9m. That's all pretty much in line with previous expectations.

Looking to the longer term, the company said: "Given the sustainable nature of the market opportunity, a broadening product offering and a growing reputation within the cloud industry, the board anticipates that growth will continue in the future."

With double-digit EPS rises forecast for at least two more years, I'm seeing good growth value here -- with rapidly rising dividends thrown in.

Restructuring

Property investment firm Helical(LSE: HLCL) was struggling under its debt burden, but it's been disposing of a lot of assets to get it down, and is focusing on higher quality income-based assets. 

Investors have responded cautiously, and since last July's low point we've seen the share price gaining 11%.

Thursday brought a trading and portfolio update, confirming that the company has "largely complete the repositioning of the portfolio as planned."

With the sale of industrial assets raising £170m, Helical has now offloaded a total of more than £250m in investment assets since the end of September. What's more, it's been at an overall premium of 8.5% over book value, so they've been reasonable investments too.

Add in the sale of Helical's retirement village portfolio and C-Space London office scheme, and we're looking at total disposals of £352m -- which has brought net debt down from £626m at 30 September, to £373m. 

New focus

The company is now focused on eight London projects and four in Manchester, and during the year it has let over 254,000 sq ft of office space in them.

With the transformation plan essentially complete, what is emerging is a company with significantly better earnings prospects, now focused on letting income from its properties rather than asset appreciation. And with its significantly smaller but better focused and more profitable portfolio, I see an attractive new phase for shareholders. 

By the time earnings are ramped up as expected by 2020, we'd be looking at a P/E of a bit over 20. But with the dividend set to grow by 6% per year and better, I see long-term value. 

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Alan Oscroft has no position in any of the shares mentioned. The Motley Fool UK owns shares of Iomart Group. 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.

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