Looking for London’s best growth stocks to buy? Here are two whose earnings are tipped to take off in the New Year.

Serabi Gold

Last year, a 26% rise in gold prices drove profits at Serabi Gold (LSE:SRB) through the roof. City analysts are expecting another sharp bottom-line rise in 2025 too — a 62% increase in earnings per share is currently tipped.

I’m not surprised at such bullishness give the high levels of economic and political uncertainty persisting in the New Year.

The World Gold Council (WGC) notes that “gold volatility has continued to reduce since the outcome of the election, but this may change in the run up to President Trump’s inauguration on 20 January, which may reignite investor interest“.

If the last couple of days are any guide, gold could be in for another landmark year (it posted 40 new record highs during the course of 2024).

Comments from the US President-elect on trade tariffs, Greenland, and Canada have pushed bullion prices to multi-week highs around $2,770 an ounce today.

Other factors that could drive gold even higher in 2025 include worsening conflict in Europe and the Middle East, enduring concerns over China’s economy, and interest rate cuts in response to dropping inflation and weak economic conditions.

It’s quite possible that Serabi could miss these growth forecasts. Production issues could strike the company’s Brazilian assets, undermining its output goals. The company is looking to ramp annual production up to 60,000 ounces by 2026.

Gold prices might also reverse if central banks fail to cut interest rates as rapidly as the market hopes, denting profits growth.

But on balance, I think the gold miner can look forward to another year of strong profits growth in 2025. Besides, I believe these dangers are more than reflected in Serabi’s rock-bottom valuation.

Today it trades on an ultra-low price-to-earnings (P/E) ratio of 2.6 times for this year.

Hochschild Mining

A bright outlook for precious metals prices bodes well for Hochschild Mining (LSE:HOC) too.

City brokers think earnings here will rise 54% year on year in 2025. This also leaves it looking dirt cheap at current prices as well.

As well as having a P/E ratio of 5.7 times, the gold and silver producer trades on a price-to-earnings growth (PEG) ratio of 0.1. Any reading below one implies that a share is undervalued.

This FTSE 250 company could allow investors to effectively hedge their bets with precious metals this year.

While gold and silver may continue to rise on continued safe-haven investment, the latter could similarly rise on signs of improving economic momentum that boosts demand for riskier assets. In this scenario, demand for silver — a heavily used material in industrial applications — might rise strongly.

Like Serabi Gold, Hochschild’s production improvements — in this case, at its flagship Inmaculada project in Peru and Mara Rosa asset in Brazil — could also help it deliver further impressive earnings growth this year.

Analysts expect £83.6bn in dividends from the FTSE 100 in 2025, according to AJ Bell, a 6.5% increase over last year. That translates into a forecast forward dividend yield of 3.9%.

Of course, this is an index-wide snapshot. Some individual stocks offer much more, including M&G (LSE: MNG) and Phoenix Group, which are both yielding over 10%!

Here, I’ll look at three FTSE 100 financial stocks that could make it rain dividends in my investing account.

10%+ yield

To start, I can’t ignore M&G. Shares of the wealth management and investment firm are currently offering an eye-popping 10.4% yield.

Better still, City analysts see the payout edging up another 3% this year, to 20.7p per share. Were this to come to fruition (bearing in mind that dividends aren’t assured), it places the forward yield at 10.8%.

In other words, investors could hope to receive nearly 21p back off every share they buy at today’s price of 190p. Just writing that makes me want to shut the laptop and reach for my phone to buy some shares!

Steady on though, there are risks to bear in mind. As an asset manager, M&G is exposed to the vagaries of financial markets, while competition is stiff. Also, the rise of passive investing continues to offer long-term challenges to the asset management industry, at least for active managers.

However, the bearish sentiment towards many FTSE 100 financial stocks looks overdone to me. M&G is due to publish last year’s earnings in March. If there isn’t anything to be alarmed about in the report, I may add some shares to my portfolio to target the otherworldly income.

8% yield

Next is Aviva (LSE: AV.). The company is already a UK insurance giant, yet is set to get even bigger after agreeing a deal to buy rival Direct Line for £3.7bn. If approved, this would significantly strengthen Aviva’s position in motor insurance.

Mind you, it would also add risk, as sizeable acquisitions like this don’t always work out. The share price has gone nowhere since the announcement, suggesting investors are lukewarm.

Looking ahead however, Aviva is forecast to hike its dividend by 7% to 38p per share this year. That translates into an attractive 8% dividend yield.

Meanwhile, the stock looks cheap, trading at a price-to-earnings multiple of 9.8. I’m happy to keep holding my Aviva shares for now

6.6%

Finally, there’s HSBC (LSE: HSBA). The Asia-focused bank has enjoyed a strong rally, with its shares now trading at a multi-year high of 790p. Yet the forecast yield for 2025 is still 6.6%, well above the FTSE 100 average.

Meanwhile, the company has been buying back a load of its shares. In October, it announced a new $3bn buyback, following on from the last one worth $3bn. Indeed, by the end of September, it had already forked out $18.4bn on dividends and buybacks for the year. So the bank is in a good place right now.

That said, HSBC makes the bulk of its profits in Asia. Were these markets, particularly China, to suffer during a new trade war under Donald Trump, that could cause volatility in earnings.

Yet, with the shares still trading cheaply and offering a 6.6% yield, I like the risk/reward setup here.

Looking at its price-to-earnings (P/E) ratio of 6, Centrica (LSE: CNA) may seem cheap. On top of that, at the current Centrica share price, the British Gas owner yields 3.1% — not a massive dividend but still decent in my view.

Even better, at its interim results point, the FTSE 100 firm was sitting on a net cash pile of £3.2bn.

So, while it has a market capitalisation of £6.9bn, when discounting for that cash pile, the market is basically assigning it a value of under £4bn.

Could this be the sort of bargain I want to add to my portfolio?

Big brand, big cash generation potential

British Gas certainly has its problems.

Repeated examples of terrible customer service have battered the company’s reputation over the years. Meanwhile, the long-term demand picture for gas looks bleak. Gas usage in the UK has been in decline for many years and looks set to continue on that trajectory.

But while demand may be falling, it is still substantial. British Gas (alongside other brands Centrica owns) is well-known even if it is not widely loved. That gives Centrica pricing power.

Meanwhile, the business has an energy trading business that means its fortunes are not necessarily tied to ongoing demand for gas in the British Isles.

As the net cash position shows (Centrica was indebted just a few years back), this is a company that is able to generate sizeable amounts of cash. I think that could continue to be the case.

Hard to assess whether this is actually a bargain

Despite that, I have no plans to add Centrica shares to my portfolio even if the current price may look like a bargain.

A postponed plan to ban the sale of new gas boilers may extend the lifetime of domestic gas usage in the UK. But the long-term trend is clear: Centrica’s core business could shrivel away over time.

I also am concerned by the risks posed by changes in energy prices, especially for the trading division. While Centrica made a post-tax profit of £3.9bn last year, the prior 12 months had seen a £0.8bn loss. That sort of volatility in earnings can make me uncomfortable.

Given that sort of volatility, it is not clear to me whether the low P/E ratio represents the sort of bargain it may initially seem to.

Why I’m not investing

Stripping it back to basics, I remain unconvinced about the long-term potential for Centrica’s business.

It has strengths, including a customer base that remains large even if it was much smaller than it once was. But the demand outlook is bleak and in the long term I see real risks to Centrica’s current business model.

So I have no plans to put my money into buying Centrica shares for my portfolio.