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Lavendon dividend on growth plan

BROKER TIP: Shares in rental company Lavendon surge to a three and a half year high on buoyant full-year numbers

What's new:

■ Double-digit dividend growth

■ Capital investment funded by cash flow

■ Rapid growth in Middle East

IC TIP: Buy at 180p

Shares in powered access equipment rental company Lavendon (LVD) touched a three and a half year high after the company announced a 26 per cent rise in underlying pre-tax profits to £27.6m in 2012. The board gave the full-year dividend a 57 per cent lift to 2.75p and set a target of between three and four times cover in the future. So, with broker Panmure Gordon upgrading EPS forecasts from 13.27p to 13.43p, there is scope for further hikes in the payout.

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