Income alert! Here’s the National Grid dividend forecast for 2023/24

Jon Smith shares the latest National Grid dividend forecasts from analysts and argues for it being a good buy for his overall portfolio.

| 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.

Young female couple boarding their plane at the airport to go on holiday.

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.

National Grid (LSE:NG) is a favourite stock for many income investors. The company has been paying out constant dividends for the past decade. With the yield during this period ranging from around 4% to 6%, it might not set the world on fire, but it has been steady cash to bank each year. In addition, the future looks bright when considering the National Grid dividend forecast.

Where we stand at the moment

The business announces two dividends during the year. This ties in with the half-year and full-year results (usually in May and November). Therefore, when I assess the current dividend yield, I use the dividend per share figure from May and November 2022. This totals 51.6p (the sum of 17.84p and 33.76p).

Based on the current share price of 1,061p, it gives me a yield of 4.86%. By comparison, the FTSE 100 average yield is 3.86%. If I owned the stock at the moment, I’d be comfortably above the average.

Should you invest £1,000 in JD Sports 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 JD Sports made the list?

See the 6 stocks

I do have to account for share price movements as well. Over the past year, the stock has fallen by 5.45%. This is a risk with dividend investing, in that my capital loss can offset the gains made from the income received. As a long-term investor, I aim to reduce this risk by holding stocks for a considerable period.

Rising yield

Next up will be full-year results in May. The dividend forecast is 35.5p, with 19.7p later in the year, totalling 55.2p for 2023. This is a jump from 2022, and if realised, could offer a juicy yield for me.

Although it’s impossible to know my exact yield until I lock in the share price, if the stock was at the same price, my yield would be 5.2%.

For 2024, analysts are forecasting a total year payment of 58p. This could increase the yield to 5.46%.

From my perspective, the increase in dividend payments isn’t unrealistic. In the last financial year, it had an operating profit margin of 24.6% and a net profit margin of 14.1%. This bodes well for paying out cash to shareholders, as it mostly comes from the profit from latest earnings.

How the stock could work for me

I understand that for some people, the numbers on offer aren’t exciting enough. Yet I go back to my original point, focused on sustainability. I’d much rather own a stock with a good track record of paying than invest in a high-yield idea that could cut the payment in the near future.

In order to try and get the best of both worlds, I’m considering buying National Grid shares to help diversify my portfolio. Let’s assume I hold one stock with a yield of 7%. If I add National Grid with a yield of 5%, I lower my risk by holding two stocks and get a blended yield of 6%. This is how I see the company fitting in to my investment pot in the future.

Created with Highcharts 11.4.3National Grid Plc PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.co.uk

5 Shares for the Future of Energy

Investors who don’t own energy shares need to see this now.

Because Mark Rogers — The Motley Fool UK’s Director of Investing — sees 2 key reasons why energy is set to soar.

While sanctions slam Russian supplies, nations are also racing to achieve net zero emissions, he says. Mark believes 5 companies in particular are poised for spectacular profits.

Open this new report5 Shares for the Future of Energy — and discover:

  • Britain’s Energy Fort Knox, now controlling 30% of UK energy storage
  • How to potentially get paid by the weather
  • Electric Vehicles’ secret backdoor opportunity
  • One dead simple stock for the new nuclear boom

Click the button below to find out how you can get your hands on the full report now, and as a thank you for your interest, we’ll send you one of the five picks — absolutely free!

Grab your FREE Energy recommendation now

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.

Jon Smith 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

Young female business analyst looking at a graph chart while working from home
Investing Articles

After collapsing 28% today, are Bunzl shares too cheap to ignore?

A poor trading statement has sent Bunzl shares to multi-year lows. Could now be a good time to consider investing…

Read more »

Investing Articles

These 5 stocks could earn £1,600 of annual passive income in a £20,000 ISA

Harvey Jones shows how to generate a high and rising passive income by buying a balanced mix of high-yielding FTSE…

Read more »

Young woman holding up three fingers
Investing Articles

3 things I like about Greggs shares

Greggs shares have tumbled by more than a third over the past year. But this writer has no plan to…

Read more »

artificial intelligence investing algorithms
Investing Articles

Nvidia stock: beware the bear market rally

Andrew Mackie argues that investors should tread carefully before investing in Nvidia stock, as the worst of the sell-off could…

Read more »

Young black colleagues high-fiving each other at work
Investing Articles

Up 73% in one year, is this the best value stock in the FTSE 100?

A brilliant run of form suggests this FTSE 100 giant should no longer make the cut as a value stock.…

Read more »

Investing Articles

The best could yet be to come for UK shares! I’m buying these ones

Amid ongoing stock market turbulence, this writer's been adding selected UK shares to his portfolio. Here's why and what he…

Read more »

Top Stocks

4 UK stocks trading well below book value to consider buying

Sometimes, it pays to be contrarian: who says the UK market has priced a stock precisely right, anyway?

Read more »

Investing Articles

The S&P 500’s 12% off its highs. Is now a good time to buy US shares for an ISA?

Right now, a lot of British investors are wondering whether it’s a good time to buy US shares. Here, Edward…

Read more »