3 FTSE 100 dividend stocks I’d buy for 2020
Whether its politics or the global economy, it seems that 2020 could be a tough year.
Of course, things may turn out better than expected. But I think it makes sense to position your portfolio so that it can cope with all weathers.
For this article Ive selected three FTSE 100 stocks with family ownership or owner-managers. I think the long-term perspective favoured by such firms is likely to make them a good buy for uncertain times.
Always in demand
The family-controlled FTSE 100 company owns Primark, plus food brands such as Twinings, Ovaltine, Pataks and Kingsmill. It also owns sugar and ingredients businesses which operate in various global markets.
This unusual business is still controlled by the founding Weston family. I suspect this is one reason why ABF is almost debt-free and has delivered at least 21 years of unbroken dividend growth.
The ABF share price has been weak over the last couple of years, as the group is going through a period of slow growth. The shares now trade on 15 times earnings, with a 2.2% dividend yield. That looks reasonable to me. I think this could be a good opportunity for new buyers to get on board.
Better than a bank?
Family ownership is an important feature of fund management house Schroders (LSE: SDR). This 215-year-old City firm has a classy reputation and conservative finances.
Like ABF, Schroders hasnt cut its dividend for at least 21 years the oldest data I could find. That means that unlike many City rivals, Schroders dividend was not cut during the financial crisis.
Growth has weakened over the last couple of years, but Schroders has recently launched a new joint venture with Lloyds Banking Group that will add 45bn of assets during the latter part of this year.
This isnt a stock Id expect to get on the cheap. But I think its worth paying a fair price for quality. SDR stock currently trades on about 15 times 2019 forecast earnings, with a 4% dividend yield. In my view, thats a fair price. Id be happy to buy at this level.
A turnaround bargain?
Mining and trading group Glencore (LSE: GLEN) is run by chief executive Ivan Glasenberg, who has an 8.7% shareholding thats worth about 2.8bn at current levels.
However, the value of Mr Glasenbergs shareholding has fallen by around 1bn over the last year, as the Glencore share price has crumbled.
The firm faces an uncomfortable mix of problems. Investigations into alleged corruption could result in big US fines. The groups copper mines in Africa have been underperforming. And Glencore faces pressure to exit its coal business, which remains a major source of profit.
However, the groups trading division continues to pump out reliable profits and cash generation remains strong. Decisive changes are under way to improve the performance of Glencores mining operations.
The shares arent without risk. But I suspect Mr Glasenberg will want to turn this business around before he retires.
It now trades on just 10 times 2020 forecast earnings, with a dividend yield of 5.9%. I rate GLEN as a turnaround buy.
Discover the name of a Top Income Share with a juicy 6% forecast dividend yield that has got our MotleyFoolUK analyst champing at the bit!
Find out why he thinks the stocks current weakness may offer us the chance to buy a proven dividend performer at what could be a bargain price.
Click here to claim your copy of this special report now free of charge!