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The UK’s FTSE 250 index of mid-sized corporations is my favorite searching floor for good high quality dividend development shares. These companies are sometimes nonetheless sufficiently small to develop, however large enough to be worthwhile and nicely established – decreasing the chance of significant mishaps.
I reckon the latest market shake up has added the alternatives which are on supply. As a long-term investor who’s nonetheless including to their portfolio, I’m excited – not apprehensive – once I see good corporations with falling share costs.
On this piece I’m going to have a look at two FTSE 250 shares I’ve been shopping for just lately for my very own portfolio.
#1: this fintech inventory seems too low-cost to me
Cost processing specialist PayPoint (LSE: PAY) is a fixture in comfort shops and different small companies throughout the UK. I see this enterprise as a fintech, connecting many alternative fee and voucher techniques.
Companies offered by the corporate’s yellow terminals embody card processing, top-ups and present vouchers, authorities profit funds, utility invoice funds and banking transfers. The corporate additionally owns the Acquire+ parcel assortment and drop-off service.
One draw back is that that is fairly an advanced enterprise, with a number of shifting elements. It’s typically laborious to comply with precisely the place the income are coming from.
Nonetheless, I’ve been following this enterprise for years and I’m assured that its robust profitability and good money era are actual. Development prospects additionally appear optimistic, with dealer forecasts suggesting earnings may rise by 10% for the 12 months ending March 2026.
PayPoint shares at present commerce on simply 9 occasions earnings, with a well-supported 6% dividend yield. That appears too low-cost to me for a corporation with revenue margins shut to twenty%.
I’ve been shopping for just lately and can be blissful so as to add extra to my portfolio if funds allowed (sadly, they don’t).
#2: an automotive inventory that’s secure from US tariffs?
President Trump’s tariffs are inflicting many automobile producers sleepless nights for the time being. However my choose from this sector, Inchcape (LSE: INCH), is a little bit totally different.
This enterprise operates as a distributor for automobile producers in international locations the place they don’t have a big, direct presence. Successfully, Inchcape permits automobile makers to outsource all of their operations in some areas of the world.
The top result’s that Inchcape operates extensively in Asia, Latin America and Europe. However so far as I can see, it doesn’t function within the USA.
Though a few of its purchasers are US or European automobile makers, a lot of them are Chinese language companies which are increasing into new markets. They usually haven’t any gross sales within the US and don’t usually rely very closely on US suppliers for the elements they use both.
In fact, tariffs may nonetheless find yourself pushing up automobile costs globally and contributing to a broader slowdown in gross sales. Inchcape would probably be affected by this.
Nonetheless, the corporate’s monetary outcomes from final 12 months counsel to me that it’s in a robust monetary place, with diminished debt and good money era.
What’s extra, Inchcape shares at present commerce on lower than 9 occasions 2025 forecast earnings, with a helpful 4.8% dividend yield.
Metropolis analysts count on the corporate’s earnings development to speed up in 2026 – in the event that they’re proper, I feel Inchcape could possibly be too low-cost to not think about at present ranges.
