Image source: Getty Images
Almost at the end of the month, it seems that the FTSE 100 A modest drop of around 2.7% is expected in October.
BT Group (LSE:BT.A) continues to fall, down 7.7% over the course of the month. I'm starting to think it might be one of the best value Footsie dividend stocks to consider buying long term.
Sizzling speeds
I write this while BT Openreach engineers are making a terrible racket right outside my window. But I won't blame the company for that.
It will be a while before I can register. But BT talks about bandwidth of up to 900MB per second, which I find amazing. When I started writing for The Motley FoolIt had a 33.6 kbps dial-up modem. I feel old!
Anyway, the point is that BT has passed the peak of its spending on fiber broadband rollout. And that means the future should be less about costs and more about revenue.
cash cow
That has to be good for the dividend. The forecast shows 5.7% this year and a modest increase, supported by strong earnings coverage.
I still don't like BT's high net debt, which reached £19.5bn at the end of the last full year. And the company's pension fund deficit rose to £4.8bn, even after an £800m contribution.
That could backfire on you.
But if BT can continue to manage things as it has been doing, it could continue to be a source of income in the form of dividends.
Real estate
I like good real estate investment trusts (REITs), although they haven't been very popular in a while. I have my eye on British land (LSE: BLND) at the moment, with its share price falling 10% in October.
They've had a decent 12 months, but we're still looking at a 36% loss over the last five years.
Please note that tax treatment depends on each client's individual circumstances and may be subject to change in the future. The content of this article is provided for informational purposes only. It is not intended to be, nor does it constitute, any type of tax advice.
Business investment
British Land is engaged in the commercial real estate business. It has a “strategy to focus on London campuses, business parks and urban logistics“. And as of the last full annual report in May, that appears to be paying off.
The biggest risk I see is in weak property values. Or, at least, a perceived weakness as real estate market sentiment is low.
But the year-end NAV per share figure was 562p, well above the share price of 399p at the time of writing. We will have to wait until November 20 to receive the update for the first half of this year.
Debt financing
The trust reported a loan-to-value figure of 37.3% with those latest results. And that means there's a fair amount of debt that needs servicing, and high interest rates haven't helped with that.
Still, rates are likely to fall further. And forecasts show a dividend yield of 5.5%, which will increase slowly in the coming years.
I fear that optimism about interest rates is already built into the stock price and that we could face a period of weakness.
But this one is also on my short list.
