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From london Alternative Investment Market (AIM) can be a great place to find great growth stocks. It can also be a happy hunting ground for investors looking for high-dividend stocks.
Here are two income generating AIM stocks that have caught my eye. I will look into adding them to my own investment portfolio if I have extra money to invest.
Accrol group holdings
fabric manufacturer Accrol group holdings (LSE:ACRL) only has a dividend yield of 1.2% for this year. But City analysts expect shareholder payouts to grow strongly in the medium term as profits pick up.
Supply chain woes and skyrocketing costs have hit profits here of late. And they could continue to be a problem for the business in the future.
But I think the rate at which sales of their private label products are growing still makes it an important purchase. He announced asubstantial growth in volume, revenue and profit” between May and October, when the cost-of-living crisis drove buyers away from the most expensive toilet paper brands.
Accrol’s market share jumped two percentage points year-over-year, to 21.5%. And I don’t think business is lightning. I think the gains here could continue to increase as the value retail market grows.
IGD analysts expect UK discount retail to grow by 23.9% between 2022 and 2027. The steady expansion of low-cost chains like Aldi and Lidl, allied with shoppers demanding more for their money , provides Accrol with excellent income opportunities.
One last thing. At current prices, the company is trading on a price-to-earnings (PEG) growth ratio of less than 1 for each of the next three fiscal years. Such readings indicate that a stock is undervalued.
Vertu Engines
Buying retail shares can be dangerous for investors at a time when the UK economy is struggling. The outlook is especially bleak for sellers of big-ticket items like cars.
Still, it’s my opinion that this harsh landscape is baked in Vertu Engines‘ (LSE:VTU) minimum rating. Today, the company trades with a forward price-earnings (P/E) ratio of 7.4 times.
It’s also true that the company’s extensive used-car network could help shield it from broader pressures on consumer wallets. Sales of its used vehicles could rise as people move away from more expensive new models.
As a long-term investor, I think buying Vertu could also be a good way to capitalize on the rise of electric vehicles (EVs). This is because buyers of these state-of-the-art cars are more likely to visit a showroom for advice before buying. Vertu has 188 franchised outlets on its books following its acquisition of Helston Motors in December.
Like Accrol, Vertu is also expected to increase dividends in the coming years. This drives a healthy 3% return for the current 12-month period ever higher.
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