Dividend payers have dominated the most popular securities chart so far this year – with the FTSE 100’s biggest paying income stock Vodafone coming in third place.
Investors in UK-listed companies will be rewarded with a £101.1 billion pay-out in 2014, as dividends are predicted to jump 27%. Buoyed by a special £16.6 billion dividend from Vodafone companies will pay out a record amount of cash, smashing the previous record set in 2012 of £80.6 billion.
Supermarket shares Tesco which pays a dividend of 5% and Morrisons which is yielding 5.9% also feature in the top 10. These two stocks are also considered undervalued by Morningstar analysts.
The first three months of the calendar year are known as ISA season – the last chance for investors to use that fiscal year’s tax-efficient allowance. As well as Vodafone and supermarkets, this ISA season investors have been keen on banking stocks. Lloyds, HSBC and Barclays all feature in the top 10 most popular securities in the first quarter of 2014. HSBC pays an income of 4.96%, well above the rate of inflation, and Barclays yields 2.65%. But Lloyds – once among the biggest dividend payers of the FTSE 100 has yet to reinstate a dividend following the financial crisis. Jupiter Financial Opportunities fund manager Guy de Blonay said he expects Lloyds to reintroduce dividend payments either the end of 2014, or early 2015.
“Lloyds is half way between restructuring and becoming a dividend daddy as we call them; a company that doesn’t need to spend or retain too much of its earnings power to fund growth, but instead of funding that growth, giving money back to shareholders,” he said.
Most Popular Shares of Q1 2014
Quindell Portfolio (QPP)
Sector: Technology
Lloyds (LLOY)
Sector: Financial Services
Vodafone (VOD)
Sector: Communication Services
Blinkx Plc (BLNX)
Sector: Technology
Tesco (TSCO)
Sector: Consumer Defensive
Barclays (BARC)
Sector: Financial Services
HSBC (HSBA)
Sector: Financial Services
Blur Group (BLUR)
Sector: Technology
Royal Mail (RMG)
Sector: Industrials
WM Morrison Supermarkets (MRW)
Sector: Consumer Defensive