The Best FTSE 250 Dividend Stocks to Watch
The FTSE 250 is a stock market index composed of 250 mid-cap stocks listed on the London Stock Exchange (LSE) which are not big enough to make it in to the FTSE 100.
At the time of writing, the FTSE 250 dividend yield is around 3.3%, however, there are many companies which have considerably higher yields than this. In this article, we will take a look at 3 of the top FTSE 250 dividend stocks to watch in 2024.
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Top FTSE 250 Dividend Stocks to Watch
Although the FTSE 100 has a reputation of being a superior choice for income investors, there are many dividend stocks in the FTSE 250 which are worth consideration.
In the following sections, we will take a look at 3 of the top FTSE 250 dividend stocks to watch in 2024.
ITV
ITV is a public broadcast television network in the UK which, at the time of writing, has a dividend yield of 6.90%. However, this high yield is partly due to the fact that ITV shares have been in long-term decline, falling more than 70% since 2015.
This prolonged fall in share price is likely to be reflective of investor sentiment surrounding the long-term outlook for what has historically been the company’s core business. Like ITV’s share price, terrestrial television is in long-term decline, with streaming services successfully stealing audiences from more traditional television providers.
Nevertheless, whilst terrestrial television may be in decline, it still generates a significant amount of cash for ITV. Furthermore, last year, the company launched a new streaming service called ITVX which performed well, with active users, streaming hours and digital revenue all experiencing strong growth in the first half of 2023.
Moreover, the broadcaster’s production arm, ITV studios, which generated more than half of ITV’s revenue in the first half of 2023, continues to see strong demand for content.
Investec
Investec is an international banking and wealth management group. Like many other banks, it has recently been reaping the rewards of higher interest rates, with net interest income soaring more than 50% in full-year 2023. Consequently, higher net interest income drove operating profit up 37% year on year.
Since its listing on the London Stock Exchange in 2002, Investec has had a reliable history of paying dividends. However, whilst its annual dividend has never been halted, it has been significantly cut on two occasions, following the financial crisis in 2008 and the outset of the pandemic in 2020.
Due to the nature of the financial crisis in 2008 and its effects on the banking sector, dividends were slashed in 2009 and, although dividends increased in the following years, it wasn’t until 2022 that the payout recovered its pre-crisis levels. It is worth noting here that, at the time of writing, the payouts of many dividend paying UK bank stocks are nowhere near their pre-2008 levels.
At the time of writing, Investec shares have a dividend yield of around 6.30%, placing it amongst the highest yielding FTSE 250 dividend stocks. Its annual dividend of 31p per share for the full-year 2023 was its highest ever and was covered 2.7 times by its profit after tax.
Tritax Big Box REIT
Real Estate Investment Trusts (REITs) may be a good option for those looking to generate passive income, as, in the UK, they are obliged to distribute 90% of their rental profit as dividends to shareholders.
There are a number of REITs in the FTSE 250, one of which is Tritax Big Box REIT which, at the time of writing, has a dividend yield of 5.12%. Tritax owns and manages a large portfolio of logistics facilities and warehouses which it rents out to various high-profile clients who include Amazon, Tesco and Ocado.
Tritax’s calibre of client makes it unlikely that it will unexpectedly lose rental income. Furthermore, the nature of its business positions it well to continue benefitting from growth in e-commerce, online retailers need locations to store and distribute their goods and this is exactly what Tritax provides.
How to Invest in the Best FTSE 250 Dividend Stocks
With an investing account from Admirals, you can buy shares in the 3 FTSE 250 dividend stocks highlighted in this article, as well as more than 4.500 other companies around the world. In order to start investing, follow these steps:
- Open an Invest.MT5 account with Admirals and log in to the Dashboard
- Find your account details and click ‘Invest’ to open the WebTrader
- Search for the desired symbol on the right-hand side of the screen
- Click ‘Create New Order’ at the bottom of the screen, enter the number of shares you wish to purchase and click ‘Buy’ to send your order to the market.
Investing with Admirals
With an Invest.MT5 account, you can buy shares in 4,500 companies around the world and more than 200 Exchange-Traded Funds (ETFs). Click the banner below in order to register for an account today:
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