Recommended here as a high-yielding defensive play last year in October at 159.75p and again in December at 175p, utility reseller Telecom Plus has more than doubled since.

The highly cash-generative company – which operates as a one-stop shop for consumers and small businesses to buy their electricity, gas, broadband, phone line and mobile phone – has grown revenues every year since foundation a decade ago. In the year to March, turnover advanced 5.7% to £186m, pre-tax profits by 45% to £16.8m and a 10p final dividend was paid.

The reasons for TEP’s continued success are straightforward. It eschews ‘wasting money’ on national advertising, relying instead on word of mouth via its network of ‘distributors’ (customers so enamoured by the savings that they sell them on to others for a small cut). This allows the group to sell its services at a discount to the big utility companies.

‘There’s very little difference between us and BT or British Gas in terms of service – we all use other people’s infrastructure,’ says chief executive Charles Wigoder. He sees the consumer downturn as being a positive influence for the company as households feel the pinch and look for savings where they can get them and new distributors join to supplement their income.

The company is so confident it predicts paying a total dividend of 'not less than 17.5p' this year and 'not less than 22p' in 2010. House broker KBC Peel Hunt forecasts 15% growth in pre-tax profits this year and next, and earnings of 20.8p and 24.3p.

We say some profit-taking might be prudent if you have doubled your money, but definitely keep a stake for further high-yielding action. Hold.

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Telecom Plus	LSE	£237.95m	357.00p	0.00p
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