Which UK stocks pay the highest dividends?

Summary

• Investing in dividend stocks provides a consistent and alternative source of income.
• Income generated from high dividend yielding shares can help the investors fulfil long-terms financial goals or reinvest the dividend into other investment options.

Investing in dividend stocks provide a consistent and alternative source of income for investors. Dividends are disbursed to shareholders in the form of cash, shares or cash equivalents, and are mostly paid out from the remaining share of profit once the essential expenses of the company are met. Additionally, it has been seen that a majority of dividend yield stocks generate higher returns, which tend to improve over time. Income generated from high dividend yielding shares can help investors to fulfil long-terms financial goals, or they can reinvest the dividend into other investment options.

While the numerous benefits of high dividend yielding stocks may lure investors, it must be noted these stocks are also associated with risks such as susceptibility to market changes. Companies may decide to lower their dividend output based on market conditions or choose to reinvest entire profits into their business instead of sharing it with shareholders.

Here is a list of the top 5 stocks with high average dividend yield for five years:

Pharos Energy Plc (LON:PHAR)

Pharos Energy is an independent company engaged in oil and gas exploration and production. The group revenues for the half-year ended 30 June 2021 were $73 million before hedging a loss of $14 million. The average realised oil price per barrel for six months ended 30 June 2021 from Vietnam was $67/bbl, with a premium of about $2/bbl to Brent, and Egypt was approximately $60/bbl, with a discount of approximately $5/bbl to Brent. For the current year the company has maintained its working interest production guidance of 9,200 - 10,600 boepd net, with Vietnam and Egypt contribution in a range of 5,200-6,200 boepd and 4,000-4,400 bopd respectively.

The shares of Pharos Energy have a 5-year average dividend yield of 12.8 per cent, and its market capitalisation stood at £102.36 million as of 10 August 2021.

Newriver Reit Plc (LON:NRR)

NewRiver Reit is a real estate investment trust engaged in investing in the management and development of leisure and retail properties. On 26 July 2021, NewRiver inked an agreement to sell Hawthorn to a constituent of the Admiral Taverns, an operator of a wet-led community pub, for £222.3 million. 

Rent collected or alternative payment terms agreed for the first quarter of the financial year witnessed an increase of 87 per cent since the declaration of the full-year result. Retail occupancy increased by over 1 per cent to 97.0 per cent since March 2021 figures; and average retail rent stood at £11.54 per sq ft as compared to £11.51 per sq ft as of March 2021:

For the shareholders who choose to receive the scrip dividend alternative for the year ending 31 March 2021, the company proposed a scrip dividend reference price for the final dividend of 82.46 pence per ordinary share.

The shares of Newriver Reit have a 5-year average dividend yield of 12.1 per cent, and its market capitalisation stood at £248.72 million as of 10 August 2021.

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Globaltrans Investment Plc (LON:GLTR)       

Globaltrans Investment is a rail transportation company that specialises in freight logistics services in the CIS, Russia, and the Baltic countries.

For the year ended 31 December 2020, the company’s revenue dropped by 20 per cent year-on-year to RUB54.9 billion, owing to the weaker pricing conditions in the gondola segment, while adjusted EBITDA stood at RUB26.8 billion, down by 32 per cent compared to RUB39.6 billion in 2019.

The shares of Globaltrans Investment have a 5-year average dividend yield of 11.8 per cent, and its market capitalisation stood at £997.31 million as of 10 August 2021.

Etalon Group Plc (LON:ETLN)

It is one of the leading development and construction companies in Russia. On 10 August 2021, it acquired a land plot in Petrogradskiy district, St Petersburg, to construct a premium residential complex spread across an area of 63 thousand sqm, due for completion by 2026. The company also delivered the final phase of the Summer Garden residential project at Dmitrovskoye Shosse, Moscow. Post completion of the Summer Garden project, the company delivered a total of 108 thousand sqm year-to-date.

Etalon’s revenues for 2020 stood at RUB78.7 billion, and EBITDA was RUB12.6 billion. The company’s new contract sales reached 538 thousand sqm valued at RUB 79.9 billion, and deliveries totalled 540 thousand sqm in 2020.

The shares of Etalon Group gave a 5-year average dividend yield of 11.3 per cent, and market capitalisation stood at £342.92 million as of 10 August 2021.

Blue Planet Investment Trust Plc (LON:BLP)

Blue Planet Investment Trust focuses on offering investors capital growth and income investment solutions. It invests in securities, including exchange-traded funds, equities, equity-related securities, and bonds and derivatives.

Blue Planet’s investment income for the year ended 30 April 2021 registered a drop of 75.0 per cent to £588,972 (2020 – £2,312,997).

On 22 July 2021, Blue Planet Investment Trust Plc proposed a final dividend of 0.52 pence (£0.0052) net per ordinary share that would be paid to shareholders (registered as of 30 July 2021) on 6 September 2021. 

The shares of Etalon Group have a 5-year average dividend yield of 11.0 per cent, and its market capitalisation stood at £13.61 million as of 10 August 2021.