I’m hoping to buy these FTSE 100 high-dividend shares for my Stocks and Shares ISA. If I invested £15,000 equally across them I could — based on current dividend forecasts — make a passive income of £1,350 in 2024.
Not only this, I’m expecting them to deliver solid dividend growth over time. Here’s why I’m aiming to buy them when I next have spare cash to invest.
St James’s Place
Dividend yield: 7.6%
Some financial services providers have endured a miserable time as tough conditions have stripped investors of cash. Asset manager St James’s Place (LSE:STJ) saw its share price plummet 38% in 2023 as new inflows cooled.
To add to its woes, in October the company was forced to overhaul its expensive fee structure following pressure from the Financial Conduct Authority (FCA). These twin pressures mean its shares are now trading on a low price-to-earnings (P/E) ratio of 9.4 times.
Could this represent an attractive entry point for me? I think so.
With interest rates tipped to fall sharply from spring, client inflows could pick up speed. From a long-term perspective its outlook certainly seem promising. The complex financial services industry, combined with favourable demographic changes, should boost demand for its face-to-face advice.
St James’s Place is also building its presence in fast-growing Middle East and Asian markets to boost profits growth. While it exited Mainland China last year, it opened a new office in Dubai. The company also has offices in Hong Kong and Singapore.
The FTSE firm is expanding its services to capitalise on this backdrop too. It had 4,766 advisers on its payroll as of last June.
HSBC Holdings
Dividend yield: 10.4%
Global banking giant HSBC Holdings (LSE:HSBA) is another dirt cheap dividend stock attracting my attention. As well as that huge dividend yield, the firm trades on a P/E ratio of just 6 times for 2024.
This low valuation reflects the trouble China’s economy is currently experiencing and the threat posed by the country’s ailing property sector. This threatens to create waves across HSBC’s Asian markets, territories from which it sources the bulk of its profits.
Yet the long-term outlook in those markets remains super-exciting. This explains why the bank is selling assets in Western countries like Canada and France and sharpening its focus on its emerging markets. In 2022 it lifted its capital allocation to Asia to 47%, and it plans to raise this further to 50%.
This geographical pivot makes sense to me. A combination of low banking product penetration and rapidly rising wealth gives HSBC an exceptional opportunity to achieve exceptional profits growth.
Last year alone it made a series of bolt-on acquisitions in Asia to boost its market position. These includes taking over Citigroup‘s Chinese wealth business and AXA‘s life insurance operations in Singapore.
The company’s balance sheet strength gives it the opportunity to continue investing in existing operations there and making more acquisitions too. Its CET1 capital ratio rose to 14.9% as of September.
Like St James’s Place, I think HSBC could be a top share to buy for dividends today and over the long term.
