Shares round-up: an 8% dividend yield and Filtronic’s rally
A deleveraging plan could catalyse this income stock’s share price, argues one analyst. Graeme Evans also reports on some good news for a top AIM stock.
1st October 2026 15:45
by Graeme Evans from interactive investor
The 8.2% forecast yield of dividend hero Primary Health Properties (LSE:PHP) remained in place today after a positive update by the NHS landlord failed to nudge shares on the path to a re-rating.
The FTSE 250-listed stock has tracked the performance of the wider Real Estate Investment Trust (REIT) sector with a 4% fall over the past quarter, meaning it is down 15% since late February at 91.4p. That represents an 8% discount to its most recent net asset value.
- Invest with ii: SIPP Account | Stocks & Shares ISA | See all Investment Accounts
There was little change in that position today even though PHP said it continued to see an improving rental growth outlook, especially in relation to recent rent reviews.
Two deals to sell assets into joint ventures are also close as PHP looks to enhance its balance sheet metrics, including by reducing its loan-to-value ratio from 57% to below 50%.
The company has just completed the integration of Assura, leading to the expected delivery of financial synergies ahead of the plan at the time of the 2025 combination. The tie-up created the UK’s largest listed healthcare REIT, with a portfolio worth £6 billion.
House broker Peel Hunt reiterated its 120p price target following today’s update, adding that shares were on 12 times forecast earnings and with a projected dividend yield of 8.2%.
Backed by one of the sector’s most secure income streams, PHP’s 30 years of consecutive income growth date back to its flotation and have secured it dividend hero status.
Chief executive Mark Davies told investors at July’s half-year results: “PHP’s portfolio of critical healthcare infrastructure delivers secure, long-term and growing income which underpins our long track record of maintaining progressive dividend policy in a structural growth sector.”
City bank Berenberg said recently that the execution of PHP’s deleveraging plan should catalyse the share price performance as it nudged up its price target to 133p.
The bank highlighted the attractive prospect of a three-year 12.1% total shareholder return compound growth rate, as well as some favourable structural tail winds.
Berenberg noted in August: “PHP is well positioned to benefit from the UK government’s long-term strategy to move more healthcare services into local communities. The development of Neighbourhood Health Centres is a direct tailwind, with three already within PHP’s portfolio.”
Space race
On AIM, interest in Filtronic (LSE:FTC) shares reignited after the radio frequency communications business announced its largest ever order from Space Exploration Technologies Corp Class A (NASDAQ:SPCX).
The $68.1 million (£51.3 million) follow-on work for Filtronic’s next-generation proprietary GaN E-band technology is expected to be materially fulfilled during the 2028 financial year.
As well as providing significantly improved revenue visibility, chief executive Nat Edington said the agreement was “another important step for the business” and the continued development of its partnership with SpaceX.
The relationship began with initial production orders in 2023 before Filtronic signed a five-year strategic partnership to supply SpaceX’s Starlink satellite internet platform in April 2024.
Shares surged more than 1,000% on the back of these developments before touching 400p earlier this year. They rallied 22.5p to 260p in today’s session, which compares with the 290p price target of joint house broker Cavendish.
- Can GSK shares outperform FTSE 100 index over the long run?
- Sign up to our free newsletter for investment ideas, latest news and award-winning analysis
While making no change to its estimates today, Cavendish said it believed that its 2028 revenue forecast was now more than 90% covered by firm orders.
It added that significant investments in new capability, capacity and new generation products left Filtronic well positioned for its next phase of growth. This includes ongoing work with SpaceX as well as an expanding base of other customers across space and defence markets.
Filtronic disclosed in its recent annual results that revenue from its largest customer SpaceX reduced to 68% of the group’s total from 83% at its 2025 results.
AIM stocks tend to be volatile high-risk/high-reward investments and are intended for people with an appropriate degree of equity trading knowledge and experience.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.