Up 375% in 10 years. Should you buy this dividend-raising stock now?

first_img Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Up 375% in 10 years. Should you buy this dividend-raising stock now? I’ve always liked Vimto brand owner Nichols (LSE: NICL), the soft drinks business, which sells to more than 85 countries. But I’ve never bought any of the firm’s shares.That’s been a big mistake on my part. The share price is around 375% higher than it was 10 years ago and there’s been a stream of rising dividends to collect along the way for shareholders.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…I always knew the firm had the kind of defensive business that could generate generally rising revenues, earnings and cash flow – ideal for supporting a dividend that goes up a bit each year. And that is exactly what Nichols has delivered. It would have been a cracking long-term buy-and-hold investment, but the valuation always seemed a little too expensive, to me.Consolidation?However, although the underlying operations have continued to make progress, the share price has moved broadly sideways for around three years and it could be a good time for me to revisit the stock. With the share price close to 1,420p, the forward-looking earnings multiple for 2020 is just over 19 and the anticipated dividend yield is around 3%.Not a bargain-basement valuation, but City analysts following the firm predict mid-single-digit-percentage increases in the dividend ahead. Meanwhile, the quality metrics remain robust, with the operating margin and the return-on-capital figure both above 20%. And the balance sheet is strong – Nichols runs a net cash position.Such slick finances have been created by the company’s branded products in the Still and Carbonate categories, such as Feel Good, Starslush, ICEE, Levi Roots and Sunkist. And the lead Vimto brand is popular in the UK and around the world, “particularly in the Middle East and Africa.”Today’s update covers trading during 2019 and there was modest growth in the top line with revenue increasing by 3.6% compared to the previous year. All three areas of the business grew, the company said in the report. The directors put the progress down to the benefits of a “strong” diversified operating model.Confident directors – nice!Chairman John Nichols said in the report that the directors are pleased with the sales progress during the year and the Vimto brand “performed very well in the UK, despite strong prior year comparatives.” Looking ahead, the directors are “confident” the firm will make long-term progress. And so am I. The long-term trading and financial records are steady, and this is exactly the kind of vehicle I’d aim to use for compounding funds for my retirement pot.Despite the 375% rise in the share price over the past decade, I’d aim to buy some of the shares during periods of stock market pessimism, or when short-term issues knock the price back. After that, this is one I’d tuck away and forget about for the next 10 years while reinvesting the dividend income along the way. Enter Your Email Address Our 6 ‘Best Buys Now’ Shares “This Stock Could Be Like Buying Amazon in 1997” Image source: Getty Images. Kevin Godbold has no position in any share mentioned. The Motley Fool UK has recommended Nichols. 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.center_img Simply click below to discover how you can take advantage of this. See all posts by Kevin Godbold I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Kevin Godbold | Thursday, 9th January, 2020 | More on: NICL last_img read more