Top 20 FTSE Dividend Paying Stocks

UPDATED JULY 2019: We reveal the top 20 paying stocks on the FTSE, but which ones are sustainable?

James Gard 2 July, 2019 | 8:00AM

Bonmarche shop

UK income investors have had a tough time so far in 2019 with a number of high-profile FTSE 100 name cutting dividends, including Marks & Spencer (MKS), and Vodafone (VOD), which cuts its pay out for the first time in almost 20 years. Former FTSE 100 member Royal Mail Group (RMGannounced plans in May to “rebase” its dividend – the postal operator will pay 25p per share this year but next year this will drop to 15p, with plans to top up the payout when the going is good.

Nevertheless, the latest dividend monitor survey from Link shows that 2019 is set to be a record year for overall dividend payouts – the first quarter saw nearly £20 billion of dividends paid by UK shares, a 15% rise, boosted by a special dividend from BHP Billiton (BHP).

But many headline dividend levels are exceptionally high because of sharply lower share prices: struggling women’s retailer Bonmarche tops the list of FTSE dividend yields in the FTSE of an incredible 66% - but that comes after a 69% fall in the share price to 11p this year. The firm is the subject of a bitter takeover battle after a run of poor performance, and could be de-listed if Edinburgh Woollen Mill-owner Philip Day takes control of more than 75% of the shares.

Kier, whose shares have fallen from above 500p in January to 106p this July, has a yield of 47% and takes second place on this list.

British Gas owner Centrica, Russia-focused steelmaker Evraz and housebuilder Persimmon are the only FTSE 100 companies to make the top 10, with yields of 13.5%, 13.6% and 11,8% respectively.

A dividend yield of more than 10% is often seen as a sign of imminent trouble for investors – Royal Bank of Scotland (RBS), for example, had a yield of 10% before the financial crisis hit and the company was bailed out by the government. The bank has just started paying a dividend for the first time in 10 years. For comparison, FTSE 100 dividend stalwart AstraZeneca (AZN), which is a staple of many income funds, has a trailing 12-month yield of just above 3%. 

Of the list below, only trading firm Plus500 makes it into Morningstar UK Dividend Yield Focus Index, which screens UK dividend-paying equities on the basis of Economic Moat and a financial health measure called Distance to Default. A strong Economic Moat indicates a company has strong barriers to competition, which should help protect its bottom line, while Distance to Default is a measure of how likely a firm is to default on its debt. Companies which don’t meet these criteria are less likely to be able to sustain their dividend pay outs. AstraZeneca also makes it into our list of sustainable dividends, as well as GlaxoSmithKline (GSK), Severn Trent (SVT) and Tayte & Lyle (TATE).

The firms below filter out Aim-listed companies and include only those FTSE companies on the London Stock Exchange’s Main Market.

Top 20 Yielding Shares on the FTSE

Bonmarche (BON) – 65.96%

Kier (KIE) – 47%

Plus500 (PLUS) – 28.83%

Capital & Regional (CAL) – 16.11%

Northgate (NTG) – 14.81%

Evraz (EVR) – 13.64%

Centrica (CNA) – 13.55%

Persimmon (PSN) – 11.80%

Stobart Group (STOB) – 11.72%

Royal Mail (RMG) – 11.53%

Galliford Try (GFRD) – 11.46%

International Personal Finance (IPF) – 11.38%

Saga (SAGA) – 10.70%

Imperial Brands (IMB) – 10.10%

Hansard Global (HSD) – 9.62%

Xaar (XAR) – 9.34%

Crest Nicholson (CRST) – 9.29%

Pendragon (PDG) – 9.26%

Hammerson (HMSO) – 9.11%

Dixons Carphone (DC.) – 9.03%

Source: Morningstar Direct data as at July 2. Trailing 12-month yield. FTSE 100 companies

 

The original version of this article was published in September 2013. The data has changed significantly since then and has been updated accordingly, most recently on July 2, 2019.

Source: Morningstar Direct

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
AstraZeneca PLC6,390.00 GBX-0.19
Bonmarche Holdings PLC8.50 GBX0.00
Capital & Regional PLC16.50 GBX2.87
Centrica PLC90.26 GBX0.58
Dixons Carphone PLC119.95 GBX0.71
EVRAZ PLC645.00 GBX1.00
Galliford Try PLC642.00 GBX1.90
GlaxoSmithKline PLC1,646.40 GBX-0.21
Hammerson PLC272.80 GBX-0.66
International Personal Finance PLC116.60 GBX2.28
Kier Group PLC78.35 GBX-2.18
Northgate PLC337.00 GBX-0.74
Pendragon PLC13.94 GBX-1.83
Persimmon PLC1,974.00 GBX-0.20
Plus500 Ltd652.80 GBX-2.42

About Author

James Gard  is content editor for Morningstar.co.uk

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