Although I don’t have unlimited reserves of cash to spend on UK dividend shares, here are three I’d happily buy for my ISA today.
The Renewables Infrastructure Group
As its name implies, The Renewables Infrastructure Group (LSE:TRIG) is a company focused on investing in renewable energy assets. More specifically, it owns wind and solar assets across Europe, as well as a string of battery storage projects.
I already own this UK share in my equities portfolio. And its excellent all-round value is making me consider increasing my holding. This ESG stock trades on a forward price-to-earnings (P/E) ratio of 9.6 times. It also carries a healthy 5.7% dividend yield.
Keeping wind and solar assets up and running can be enormously expensive. And the threat to operators is growing as extreme weather events become more common.
Yet I believe the potential upside of owning Renewables Infrastructure shares offsets this risk. Businesses like this will play a huge role in helping Britain and the European Union meet their carbon reduction targets.
The PRS REIT
Soaring rents are driving profits at residential landlords such as The PRS REIT (LSE:PRSR) through the roof. This provides — at least in the case of this UK share — plenty for income investors to get excited about.
Under real estate investment trust (REIT) rules, the company must pay at least 90% of annual rental profits out by way of dividends. This is why the payout yield here sits at an enormous 4.6%.
A chronic undersupply of new rental homes is driving rents ever higher. Latest data from estate agent Hamptons shows that tenant costs have soared 25% since the beginning of the pandemic. As weak housebuilding levels persist and buy-to-let investors withdraw from the market, the supply and demand imbalance is on course to worsen.
Higher-than-usual building costs pose a threat to PRS REIT’s earnings. But, on balance, I’m still expecting profits here to rise strongly through the short-to-medium term and probably longer.
Sylvania Platinum
Investing in mining stocks can be dangerous business. Even during positive periods for commodities prices, earnings at such businesses can suffer if production problems emerge. These can decimate revenues and drive up costs.
Yet Sylvania Platinum (LSE:SLP) is still an attractive stock to own, in my opinion. The precious metals it digs for look set to benefit from a worsening market deficit as investment and industrial demand outpaces supply.
This week, the World Platinum Investment Council predicted a material deficit of 983,000 ounces in 2023. This was up 77% from just three months ago, with solid investor demand — allied with soaring consumption from automotive and industrial customers — all tipped to rise this year.
I don’t think this improving outlook is reflected in Sylvania Platinum’s low share price. It trades on a forward P/E ratio of just 6.1 times right now. With the South African producer also carrying a 6.8% dividend yield, I think it’s a top value stock to buy.
