Today I’m looking at the investment case of four dividend dynamos.
Dividend destroyer
The defence sector has long been a magnet for those seeking dependable dividend growth, with industry giant BAE Systems’ (LSE: BA) wide reach and top-tier supplier status to the US and UK making it a particular favourite.
War has been ever-present in human history, a situation that’s not likely to end any time soon — indeed, Western defence budgets are likely to keep rising to battle the growing threat of international terrorism, not to mention reacting to rising Chinese and Russian expansionism.
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With BAE Systems’ sales expected to continue ticking higher, dividends of 21.5p and 22.1p per share are pencilled-in for 2015 and 2016, respectively, resulting in chunky yields of 4.2% and 4.3%.
A financial firecracker
Through shrewd product development in line with demographic and legislative changes, as well as a steadily-improving global footprint, I’m convinced insurance giant Aviva (LSE: AV) should keep on delivering market-beating dividend yields as sales explode.
As well as the prospect of resplendent revenues growth, Aviva’s recent purchase of Friends Life affords it terrific capital synergies that should also turbocharge dividend flows in the years ahead.
Indeed, the City expects Aviva to fork out a dividend of 23.8p per share this year, yielding a gargantuan 5.1%. And this figure moves to 6% for 2017 thanks to predictions of a 27.9p bounty.
Fill your basket
Regardless of the state of the wider economy, the supreme popularity of Reckitt Benckiser’s (LSE: RB) products gives it earnings visibility few others can match.
The company can regularly lift prices of items like Nurofen painkillers and Harpic bleach irrespective of constraints on consumer spending power. And the vast sums Reckitt Benckiser dedicates to improving these ranges continues to push sales higher in established and emerging regions alike.
Sure, current dividend projections may lag the broader FTSE 100’s 3.5% — anticipated payouts of 139.6p per share for 2015 and 150.9p for next year create yields of just 2.1% and 2.3%. But I believe the firm will prove a surefire hit for those seeking reliable, and explosive, annual payout growth in the near-term and beyond.
Build brilliant returns
I believe that the housing sector is one of the safest destinations for those seeking abundant income flows in the years ahead, making Taylor Wimpey (LSE: TW) one of the best dividend stocks out there.
Despite government pledges to help first-time buyers by increasing landlords’ stamp duty and building new homes, the housing stock still remains chronically insufficient. At the same time, a backcloth of improving buyer affordability and supportive lending conditions continues to drive property demand through the roof.
And this backdrop is unlikely to abate any time soon, a positive sign for Taylor Wimpey’s earnings and consequently dividend outlook. Indeed, the construction play is expected to pay dividends of 11p in 2015 and 11.8p next year, figures that create mammoth yields of 6.2% and 6.6%, respectively.
