3 Dividend Stocks That Could Help You Beat the Market Volatility

By - Suhita Poddar

Source: teh_z1b, Shutterstock


  • Dividend stocks allow you to stay invested for capital appreciation while rewarding you with interim cash flows.
  • These stocks help investors in being invested through economic downturns and volatile periods.

The Covid-19 pandemic has squeezed out a lot of cash from the pockets of investors. Many lost their jobs despite the government coming for support running the furlough scheme. 2020 has given a lot of bruises and therefore, smart investors are looking forward to traditional methods of investing by considering dividend stocks in their portfolio.

The stock markets have been steadily recovering after the mass vaccination drives carried out by the government; however, the constantly evolving pandemic might strike back. Therefore, dividend stocks can provide a much-required cushion for your portfolio as you can still enjoy passive income in the form of dividends.

Also read: 5 FTSE100 Stocks That Have Over 6% Dividend Yield


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In this article, we shall put our lens through dividend stocks that might help you remain invested through the volatile periods.

The precious metal miner Hochschild Mining delivered strong financial results in 2020, despite hitting roadblocks related to the Covid-19 pandemic. The company ended 2020 with a record net cash position in last eight years due to superior precious metals prices coupled with strong free cashflow.

The company holds a strong balance sheet and has proposed a final dividend of 2.335 cents per share, bringing the full-year total dividend to $32.6 million in 2020. The company added 25.3 million silver equivalent ounces of reserves via its drilling programme at Inmaculada. The management has approved the construction of the ore sorting pilot plant at Inmaculada and has sanctioned $7 million for the same. According to the company’s 2021 outlook, it aims to attain 360,000-372,000 gold equivalent ounces of production (31-32 million silver equivalent ounces).

Despite the strength in the precious metal prices, the company followed a prudent approach and has the resources to tackle the challenges ahead. The precious metal miner aims to add further high-quality ounces to its resource base and optimise its early-stage projects and therefore has initiated another brownfield exploration programme involving drill targets across its portfolio. The company’s annual dividend yield was around 2.2 per cent. Hochschild Mining’s market capitalisation stood at £1,054.47 million as of 14 April 2021 closing. HOC shares delivered a price return of 50.25 per cent in the past 52-week period.

Also read: Focus on 5 FTSE Stocks with Long History of Dividend Payouts


Inchcape Plc (LON: INCH) is a London, United Kingdom-based automotive retailer and distributor. Despite a poor performance during 2020, Inchcape continuously focused on improving its distribution capacity. Most of the geographies are now reopened, while the Covid-19 situation remains uncertain. The company has a solid cash generative business model that bolsters its financial position. Notably, the company’s net cash stood at £266 million as of 31 December 2020. Driven by the optimistic outlook of the company, the Board had proposed a dividend of 6.9 pence for the year 2020.

In response to the Covid-19 pandemic, Inchcape has adopted a significant cost-restructuring programme to see through the challenging period. Inchcape is now focusing on long-term growth opportunities and has resumed dividend payouts. The company’s annual dividend yield was around 0.88 per cent. Inchcape’s market capitalisation stood at £3,081.30 million as of 14 April 2021 closing. INCH shares delivered a price return of 58.35 per cent in the past 52-week period.

UK based motor insurer Sabre Insurance Group Plc (LON: SBRE) continued to focused on maintaining discipline through FY20 and delivered a resilient performance. The Group expects to have ample growth opportunities in 2021 and 2022, considering the market dynamics, its lower premium levels, robust capital range, and attractive profitability and dividend potential.

For 2020, the combined operating ratio of the insurer stood at 75.3 per cent, which was in line with long-term target. The Group also maintained a robust organic capital generation, and hence, the solvency coverage ratio stood at 203 per cent, while the post-dividend solvency ratio was 155 per cent, which was in line with the preferred capital range. Operationally, Sabre also leveraged automation and artificial intelligence to bring operational efficiencies and developed the 'van' portfolio.

Overall, the insurer maintained good financial performance in 2020, and strives to carry the same momentum in 2021. The Group also sustained solid dividend payouts for its shareholders and generated claims savings with temporary price discounts. For the year 2020, the insurer announced a total dividend of 21.2 pence per share. In a nutshell, the Company is well-positioned to pursue growth opportunities in the long-term. The company’s annual dividend yield was around 4.26 per cent. Sabre’s market capitalisation stood at £651.25 million as of 14 April 2021 closing.


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