Buy Provident Financial Plc

Provident Financial is a rare financial company that offers double-digit earnings growth (EPS CAGR of 15%), resulting in 25% potential upside to our price target of 1970p, coupled with a high and growing dividend yield of 5.4%.

Recent investor concern that PFG’s major shareholder may be looking to sell part of its significant 25% holding appears overblown and we believe that the recent share price weakness provides an ideal entry point for investors looking for both capital growth and income.