As a value investor, I’m always on the lookout for dividend shares which have underperformed in recent months. Therefore, I’ve managed to find 4 shares which may be considered ‘unloved’ by investors at the moment, since their share prices are in the red in the last year.
Lloyds Banking Group PLC (LON:LLOY) (LSE:LLOY.L) has registered a share price fall of 3.1% in the last year. In spite of this, I’m optimistic about the company’s dividend future. I think over the last few years it has put in place a relatively solid balance sheet and has been able to reduce costs. In my view, this has made it one of the more efficient UK bank shares. I believe this will help Lloyds to turn around its falling share price of the last year over the long run. I also feel the sales of the government’s shares may ease investor sentiment in the stock.
Vodafone Group plc’s (LON:VOD) (LSE:VOD.L) share price has slumped 6.3% in the last year. I’m slightly surprised at this, because I feel Vodafone has made good progress. It has diversified its offering and invested in other companies in order to strengthen its relative position. However, I suppose the quad play offering is becoming more competitive not only in the UK but across Europe. Even so, I think Vodafone’s shares have dividend appeal and could reverse their fall in future.
easyJet plc’s (LON:EZJ) (LSE:EZJ.L) share price fall of 38.6% in the last year is probably less surprising. Demand and supply issues have caused its financial performance to suffer. On the supply side, cheaper oil has meant a greater number of pan-European services, which equals more competition. On the demand side, easyJet has seen holidaymakers put off purchases by terrorist incidents in Europe. However, I think the company’s dividend and share price prospects remain sound due to its relatively strong finances and the possible appeal of its budget pricing offer.
In the last year, the share price of Centrica PLC (LON:CNA) (LON:CNA.L) has dropped 0.5%. Only a small fall, but at a time when other utility stocks have generally been popular due to higher uncertainty, investors are bound to be slightly disappointed. Still, I think Centrica’s cost savings measures and new strategy could help to position the company for dividend growth. Therefore, I’m reasonably optimistic about its long term share price potential, although due to the changes it is making I feel its short term outlook could be relatively volatile.