2 top dividend shares (including a small-cap stock) I’d buy today!

I’m looking for the best dividend shares to boost my passive income in 2023. Here are two that are on my investing radar today.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Asian man looking concerned while studying paperwork at his desk in an office

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

I don’t have unlimited reserves of capital I can use to invest. But here are two terrific dividend shares — one of which is a soaring small-cap share — I’ll buy for my portfolio if I have cash to spare.

I believe they could provide a healthy second income for years to come.

Central Asia Metals

Investing in mining shares can be a wild ride. Even the best-run raw materials producer can endure profits crashes when commodity prices fall. The Central Asia Metals (LSE:CAML) share price for example sank last summer as prices of industrial metals came under pressure.

Should you invest £1,000 in Legal & General right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets. And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Legal & General made the list?

See the 6 stocks

But I’d still buy this mining company for my shares portfolio today. This business — which is listed on London’s Alternative Investment Market (AIM) — produces copper from Kazakhstan. It also owns a lead-and-zinc-producing asset in North Macedonia.

Created with Highcharts 11.4.3Central Asia Metals Plc PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.co.uk

I like this particular business because of its impressive record of production. The mining giant beat output estimates again in 2022 at its Kounrad copper project after another record year. Central Asia Metals also produces metal at extremely low cost.

I think profits here could soar from later on this decade if likely supply shortages emerge and prices of base metals rise. The graph below from Wood Mackenzie illustrates how copper demand, for example, could be on course to outstrip future production. Trends like increasing urbanisation and the energy transition will both supercharge demand for the red metal.

Graph showing projected supply and demand in the copper market.

I also think Central Asia Metals is a top stock for dividend income. Today it carries a 7% dividend yield. I think this is too big to ignore.

Brickability Group

Investing in small-cap shares can be a great idea for growth-hungry investors. But many smaller UK stocks can also be great investments for passive income. This is where building product manufacturer Brickability Group (LSE:BRCK) comes in.

Created with Highcharts 11.4.3Brickability Group Plc PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.co.uk

As the name suggests, this AIM stock makes its money predominantly from selling bricks. Sales volumes of these critical components are tipped to soar as housebuilding activity in Britain picks up (the government is targeting the creation of 300,000 new homes each year).

In fact trading at Brickability is already very impressive. Last week it announced that it “continued to deliver a strong performance across all of its business divisions” and hiked its profit forecasts for the year. That’s even as the housing market suffers near-term softness due to rising mortgage costs.

I’m also expecting a strong repair, maintenance and improvement (RMI) market to underpin strong profits growth at the firm. The UK has one of the oldest housing stocks in the world. This means constant updating is required to stop the country’s homes crumbling into dust.

Now let’s look at Brickability’s dividend forecasts. For the financial years to March 2023 and 2024 the dividend yield sits at a juicy 4.5% and 4.7% respectively.

Making bricks is an energy-intensive process. So Brickability’s profits could suffer if oil and gas prices spike again. But on balance I think this small-cap share could be a great way to make excellent dividend income.

Should you invest £1,000 in Legal & General right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Legal & General made the list?

See the 6 stocks

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Man smiling and working on laptop
Investing Articles

3 FTSE 250 shares with low P/E ratios and sky-high dividend yields!

Searching for the best bargains that London has to offer? Here's a handful from the FTSE 250 I think are…

Read more »

Investing Articles

Why is Apple stock lagging the S&P 500 in 2025?

Our writer is wondering whether now might be an opportune time to snap up shares of the largest company in…

Read more »

Investing Articles

Here’s how an ISA investor could build a £20k passive income with UK shares

Looking to make a five-figure passive income in retirement? Here's how a blend of UK shares and cash savings could…

Read more »

Investing Articles

£10,000 in savings? Here’s how an investor can target £3,560 in annual passive income

Paul Summers explains how an investor could target making thousands of pounds in passive income by holding great dividend stocks…

Read more »

Young Asian man drinking coffee at home and looking at his phone
Investing Articles

Up 490%, Lion Finance Group is a new name on the FTSE 250… but what is it?

Many investors won’t be familiar with Lion Finance Group, but the FTSE 250 stock has surged 490% over five years.…

Read more »

Growth Shares

I think this is the most punished FTSE stock in the market right now

Jon Smith talks through a FTSE company that has endured problems but is one he believes has a brighter future…

Read more »

Smart young brown businesswoman working from home on a laptop
Investing Articles

Stock market correction! 1 growth share down 53% to consider buying now

This writer highlights a growth stock that has hit a rough patch in recent weeks. Here's why it might be…

Read more »

Investing Articles

Here’s why the Tesco share price has dropped 18% in a month!

Tesco's share price has lost nearly a fifth of its value since mid-February. Is this FTSE 100 dividend stock now…

Read more »