Duke Capital plc (LON:DUKE) has demonstrated robust progress as highlighted in its recent third-quarter trading update for the year ending 31 December 2024. The update reveals an impressive year-on-year recurring cash revenue growth of 4%, reaching £6.5 million—a new record for the company. This strong performance underscores Duke’s continued commitment to delivering shareholder value.
The update also spotlighted significant milestones, including the approval of an interim dividend of 0.7p per share for the third quarter. This aligns with their forecasted full-year dividend per share of 2.8p, fully covered by free cash flow. Duke Capital’s dividend yield of over 9% remains highly attractive, particularly as the outlook for UK interest rates appears favourable, potentially reducing debt costs and further highlighting the dividend’s value.
Strategic Moves for Future Growth
Duke Capital has made strategic moves to secure its growth trajectory, including an oversubscribed £23.5 million equity raise. These funds are earmarked for deploying capital in existing portfolio opportunities, showcasing a proactive approach to growth. Additionally, the company has made strides in finding a third-party capital provider, supporting its transition to a self-funding, balance sheet-light model.
Andrew Renton, Director of Research at Cavendish, remarked: “Duke’s ability to maintain steady dividend payments and its strategic shift toward a self-funding model are commendable. These initiatives are poised to strengthen its position in the market and support its long-term growth objectives.”
A Bright Outlook
Looking ahead, Duke Capital’s financial forecasts remain optimistic. With a target price of 45p per share, representing a potential upside of 50% from the current price of 30p, the company’s growth prospects are evident. Lower forecasted UK interest rates not only benefit operational costs but also enhance the relative attractiveness of Duke’s offerings in the market.
On a Final Note
Duke Capital continues to set new benchmarks, showcasing resilience and strategic foresight in a competitive landscape. Investors seeking robust returns and sustainable dividends may find Duke Capital an appealing option. With its proactive approach and strong financial fundamentals, Duke Capital is poised for continued success.
