Top 40 High-Yield Blue-Chip UK Stocks: Autumn 2023 (2024)

dividend stocks Oct 05, 2023

Welcome to the Autumn 2023 update of my top UK dividend stocks list.

Before we get to the list of stocks, I just want to point out a couple of things that you (assuming you're a UK dividend investor) are probably already aware of.

UK dividend yields are unusually high

The UK is doomed, we're a pariah and the economy will never recover. At least, that seems to be the narrative among those investors who have abandoned the UK stock market for the glamour (and low yields) of the US market.

This aversion to UK stocks has pushed UK share prices down, which makes investors sad, but it has also pushed dividend yields up, which should make income investors rejoice.

The FTSE 250, for example, is having an especially torrid time at the moment and is about flat over one year, three years and five years (it's actually down about 10% over five years).

This has made investing in the UK something of an unpleasant slog in recent years. However, just look at the impact that's had on the overall dividend yield of UK mid-cap stocks.

Top 40 High-Yield Blue-Chip UK Stocks: Autumn 2023 (1)

The FTSE 250's dividend yield at the beginning of October was 3.9%. That's comfortably above the long-term average of 3% and it's about as high as the index's dividend yield ever gets (other than in the depths of the 2008-2009 crash).

This is good news because, despite its simplicity, dividend yield is actually a fairly reliable indicator of value and future returns. In other words, when dividend yields are high, expected future returns are also high.

For example, in the chart above, you can see that dividend yields were high in the early 1990s, 2002, 2008 and 2020. Investors who focused on share prices were depressed because prices were falling, but investors who focused on dividend yields were happy because yields were rising.

The yield-focused investors were right to be happy because in each case, the stock market did produce excellent returns over the next few years.

Whether that will happen this time around is impossible to know, but history suggests that this should be a good time to buy UK stocks.

Dividend yields for some individual UK stocks are through the roof

While the FTSE 250's 3.9% dividend yield is historically impressive, there are far higher yields available across a wide range of individual stocks.

For example, the average dividend yield across this top 40 list of relatively large, high-yield stocks is 6.5%. The average yield across the top 10 stocks is 8.6%. If that isn't high-yield then I don't know what is.

Of course, there is an elevated risk of dividend cuts and suspensions when yields are so high, but in many cases, that seems unlikely.

Although Vodafone seems like a basket case, other stocks like British American Tobacco and Legal & General (both of which are in the UK Dividend Stocks Portfolio and my personal portfolio) seem to be well-placed to maintain and even grow their dividends (although, of course, no dividend is ever guaranteed).

Overall, I would say that the UK does offer rich pickings to dividend investors, and on that note, you'll find the full top 40 list of UK dividend stocks below.

You can also download a PDF version of this list, and if you're reading this after October 2023, you can see the current list on the Top UK Dividend Stocks page.

No.Company (Links to Review)SymbolIndexSectorShare PriceDividend Yield (%)
1British American Tobacco PLCBATSFTSE 100Tobacco£25.078.7
2Rio Tinto PLCRIOFTSE 100Industrial Metals and Mining£50.358.1
3Vodafone Group PLCVODFTSE 100Telecommunications Service Providers£0.7610.3
4Glencore PLCGLENFTSE 100Industrial Metals and Mining£4.537.8
5Anglo American PLCAALFTSE 100Industrial Metals and Mining£21.587.8
6Legal & General Group PLCLGENFTSE 100Life Insurance£2.139.1
7Imperial Brands PLCIMBFTSE 100Tobacco£16.258.7
8Aviva PLCAV.FTSE 100Life Insurance£3.768.3
9National Grid PLCNG.FTSE 100Gas, Water and Multi-utilities£9.326.0
10Phoenix Group HoldingsPHNXFTSE 100Life Insurance£4.6311.0
11BT Group PLCBT.AFTSE 100Telecommunications Service Providers£1.136.8
12SSE PLCSSEFTSE 100Electricity£15.216.4
13M&G PLCMNGFTSE 100Investment Banking and Brokerage Services£1.9310.2
14NatWest Group PLCNWGFTSE 100Banks£2.256.1
15Lloyds Banking Group PLCLLOYFTSE 100Banks£0.435.6
16Taylor Wimpey PLCTW.FTSE 100Household Goods and Home Construction£1.148.3
17Barratt Developments PLCBDEVFTSE 100Household Goods and Home Construction£4.198.1
18WPP Group PLCWPPFTSE 100Media£7.175.5
19HSBC Holdings PLCHSBAFTSE 100Banks£6.454.1
20abrdn PLCABDNFTSE 250Investment Banking and Brokerage Services£1.549.5
21Barclays PLCBARCFTSE 100Banks£1.544.7
22GSK PLCGSKFTSE 100Pharmaceuticals, Biotechnology and Marijuana Producers£14.854.1
23St James's Place PLCSTJFTSE 100Investment Banking and Brokerage Services£7.946.7
24BP PLCBP.FTSE 100Oil, Gas and Coal£5.163.9
25Burberry Group PLCBRBYFTSE 100Personal Goods£18.263.3
26Unilever PLCULVRFTSE 100Personal Care, Drug and Grocery Stores£40.543.6
27Schroders PLCSDRFTSE 100Investment Banking and Brokerage Services£3.965.4
28Shell PLCSHELFTSE 100Oil, Gas and Coal£25.783.4
29DS Smith PLCSMDSFTSE 100General Industrials£2.766.5
30Sainsbury (J) PLCSBRYFTSE 100Personal Care, Drug and Grocery Stores£2.485.3
31Tesco PLCTSCOFTSE 100Personal Care, Drug and Grocery Stores£2.604.2
32Kingfisher PLCKGFFTSE 100Retailers£2.145.8
33ITV PLCITVFTSE 250Media£0.677.4
34United Utilities Group PLCUU.FTSE 100Gas, Water and Multi-utilities£9.135.0
35Investec PLCINVPFTSE 250Banks£4.516.9
36Intermediate Capital Group PLCICPFTSE 250Investment Banking and Brokerage Services£13.006.0
37Smurfit Kappa Group PLCSKGFTSE 100General Industrials£26.524.6
38Vistry Group PLCVTYFTSE 250Household Goods and Home Construction£8.326.6
39Reckitt Benckiser Group PLCRKTFTSE 100Personal Care, Drug and Grocery Stores£57.663.2
40Mondi PLCMNDIFTSE 100General Industrials£13.324.6

Keep an eye out for the next update, which will be in January.

Disclosure: British American Tobacco, Legal & General, WPP, Unilever, Schroders and ITV are in the UK Dividend Stocks Portfolio and my personal portfolio.

TheUK Dividend Stocks Newsletter

"An excellent newsletter with a real commitment to transparency"- Edward Page-Croft, CEO of Stockopedia

Full list of all holdings in the UK Dividend Stocks Portfolio

Detailed reviews ofevery buy, sell, trim and top-up decision

Brief reviews of all quarterly, interim and annual results for all holdings

Unique UK dividend stock screencovering almost 200stocks

In continuous publication since 2011


The UK Dividend Stocks Blog

Get the latest blog posts sent straight to your inbox in no more than one email per week:

Monthly Top 40 High-Yield Blue-Chip UK Stocks list

Detailed reviews of UK dividend stocks

Updates on the UK Dividend Stocks Portfolio

UK stock market and housing market valuations

No spam. Unsubscribe anytime.

As an avid investor and financial expert with a deep understanding of dividend stocks, let's delve into the concepts presented in the article from October 5, 2023, focusing on UK dividend stocks.

High UK Dividend Yields: The author highlights the unusually high dividend yields in the UK. This is attributed to a narrative where some investors have abandoned the UK stock market in favor of the US market, leading to depressed UK share prices but simultaneously increasing dividend yields. The FTSE 250, in particular, is struggling, but its dividend yield stands at 3.9%, comfortably above the long-term average of 3%.

Impact of Dividend Yields on Returns: The article emphasizes the historical relationship between high dividend yields and future returns. By referencing a chart, the author shows that periods with high dividend yields, such as in the early 1990s, 2002, 2008, and 2020, were followed by excellent stock market returns in subsequent years. This historical pattern suggests that the current high dividend yield environment in the UK might indicate a good time to invest.

Individual UK Stocks with High Dividend Yields: The article introduces a list of the top 40 UK dividend stocks, emphasizing their attractive average yield. The average dividend yield across the top 40 stocks is 6.5%, with the top 10 stocks offering an even higher average yield of 8.6%. The author acknowledges the elevated risk of dividend cuts and suspensions with such high yields but suggests that some stocks, like British American Tobacco and Legal & General, seem well-positioned to maintain or even grow their dividends.

Top 10 UK Dividend Stocks: The list provides key details about the top 10 UK dividend stocks, including the company name, symbol, index, sector, share price, and dividend yield. Noteworthy stocks include British American Tobacco (8.7% yield), Rio Tinto (8.1% yield), and Vodafone Group (10.3% yield).

Investment Strategy and Caution: While highlighting the rich opportunities for dividend investors in the UK, the author maintains a cautious tone, acknowledging the risk associated with high dividend yields. The article suggests that despite challenges in the UK market, certain stocks present attractive opportunities for income investors.

Personal Portfolio and Disclosures: The author provides transparency by disclosing their personal holdings, which include British American Tobacco, Legal & General, WPP, Unilever, Schroders, and ITV. This information adds credibility to the author's recommendations and aligns with the narrative of the article.

In summary, the article navigates through the current state of the UK stock market, focusing on the high dividend yields and the historical relationship between such yields and future returns. The inclusion of specific stocks and the author's personal portfolio disclosures enhance the credibility of the recommendations for potential investors in the UK dividend market.

Top 40 High-Yield Blue-Chip UK Stocks: Autumn 2023 (2024)


Top Articles
Latest Posts
Article information

Author: Stevie Stamm

Last Updated:

Views: 6342

Rating: 5 / 5 (60 voted)

Reviews: 83% of readers found this page helpful

Author information

Name: Stevie Stamm

Birthday: 1996-06-22

Address: Apt. 419 4200 Sipes Estate, East Delmerview, WY 05617

Phone: +342332224300

Job: Future Advertising Analyst

Hobby: Leather crafting, Puzzles, Leather crafting, scrapbook, Urban exploration, Cabaret, Skateboarding

Introduction: My name is Stevie Stamm, I am a colorful, sparkling, splendid, vast, open, hilarious, tender person who loves writing and wants to share my knowledge and understanding with you.