Dividend-paying stocks that combine healthy balance sheets with hefty yields can provide investors with steady incomes, cushion against market downturns, and grow investments at a healthy clip.
In July 2024, the top-performing dividend-payers included asset management firm Bridgepoint Advisers (BPT), renewable energy firm Drax Group (DRX), and asset management firm St. James's Place (STJ).
To find the month's 10 best-performing income-focused stocks, we screened the Morningstar UK Index – which measures the performance of the UK's broad regional markets, targeting the top 97% of stocks by market capitalisation – for companies with a forward dividend yield of at least 1.5%, excluding real estate investment trusts.
The Best-Performing UK Dividend Stocks of July 2024
1. Bridgepoint Advisers (BPT)
2. Drax Group (DRX)
3. St. James's Place (STJ)
4. Travis Perkins (TPK)
5. Keller Group (KLR)
6. Volution Group (FAN)
7. AJ Bell (AJB)
8. TBC Bank Group (TBCG)
9. OSB Group (OSB)
10. Genuit Group (GEN)
How Have Dividend Stocks Performed?
The Morningstar UK Dividend Yield Focus Index, which tracks the performance of high-quality, dividend-paying stocks listed in the UK, rose 6.0% over the past month and 14.8% over the past year.
The overall UK stock market, as measured by the Morningstar UK Index, has gained 3.2% on the month and 13.7% on the year.
Yields and Metrics for July's Best-Performing Dividend Stocks
Bridgepoint Advisers
Asset management firm Bridgepoint Advisers rose 32.9% in July and gained 59.8% over the past 12 months. Trading at £2.93 per share, its stock has a forward dividend yield of 3.14%. Bridgepoint Advisers pays investors a trailing 12-month dividend of 9p per share. The stock has a quantitative Morningstar Rating of 3 stars.
Drax Group
Renewable energy firm Drax Group rose 31.8% in July and gained 11.0% over the past 12 months. At £6.49 per share, its stock has a forward dividend yield of 3.75% and a trailing 12-month dividend of 23p per share. It has a quantitative Morningstar Rating of 3 stars.
St. James's Place
Asset management firm St. James's Place gained 25.3% in July and fell 24.6% over the past 12 months. The stock's £6.85 price gives it a forward dividend yield of 2.04%. St. James's Place pays investors a trailing 12-month dividend of 24p per share. The stock has a quantitative Morningstar Rating of 3 stars.
Travis Perkins
Building products and equipment firm Travis Perkins rose 24.6% in July and gained 12.1% over the past 12 months. Trading at £9.58 per share, Travis Perkins stock has a forward dividend yield of 1.88% and a trailing 12-month dividend of 39p per share. It has a quantitative Morningstar Rating of 4 stars.
Keller Group
Engineering and construction company Keller Group gained 21.3% in July and rose 79.3% over the past 12 months. Trading at £14.90 per share, its forward dividend yield is 3.03%. Keller Group pays investors a trailing 12-month dividend of 38p per share. It has a quantitative Morningstar Rating of 3 stars.
Keller Group
Building products and equipment firm Volution Group gained 21.3% in July and rose 38.3% over the past 12 months. At £5.47 per share, Volution Group stock has a forward dividend yield of 1.52% and a trailing 12-month dividend of 8p per share. It has a quantitative Morningstar Rating of 2 stars.
AJ Bell
Asset management firm AJ Bell rose 20.9% in July and gained 43.5% over the past 12 months. Trading at £4.59 per share, AJ Bell stock has a forward dividend yield of 2.51% and a trailing 12-month dividend of 11p per share. It has a quantitative Morningstar Rating of 2 stars.
TBC Bank Group
Regional bank TBC Bank Group rose 20.6% in July and gained 32.8% over the past 12 months. Trading at £31 per share, TBC Bank Group stock has a forward dividend yield of 6.68% and pays investors a trailing 12-month dividend of £1.64 per share. The stock has a quantitative Morningstar Rating of 3 stars.
OSB Group
Mortgage finance firm OSB Group gained 20.4% in July and rose 49.2% over the past 12 months. The stock's £5.16 price gives it a forward dividend yield of 6.2%. OSB Group pays investors a trailing 12-month dividend of 32p per share. The stock has a quantitative Morningstar Rating of 3 stars.
Genuit Group
Building products and equipment firm Genuit Group rose 18.7% in July and gained 67.5% over the past 12 months. At £5.12 per share, Genuit Group has a forward dividend yield of 2.42% and a trailing 12-month dividend of 12p per share. It has a quantitative Morningstar Rating of 3 stars.
What Is the Morningstar UK Index?
The Morningstar UK Index measures the performance of the UK's broad regional markets, targeting the top 97% of stocks by market capitalisation. The index does not incorporate environmental, social, or governance criteria.
What Is the Morningstar UK Dividend Yield Focus Index?
The Morningstar UK Dividend Yield Focus Index captures the performance of a portfolio of high-quality, dividend-paying securities.
It's a subset of the Morningstar UK Index (which represents 97% of the equity market capitalisation) that includes only stocks that pay dividends. The stocks are screened for economic moat and financial strength compared to others in their sector. Real estate investment trusts are excluded.
The 25 highest-yielding stocks are included in the index, weighted by the dollar value of the dividends. See the full rulebook here.
The Best Dividend Stock Leaders: More Ideas to Consider
Investors who would like to uncover more top-performing or cheap dividend stocks to research further can do the following:
• Review the full list of Dividend stocks included in the Morningstar UK Dividend Yield Focus index. Those dividend stocks with Morningstar Ratings of 4 or 5 stars are undervalued, according to our metrics.
• Read our monthly analysis of the latest dividend moves among the top FTSE 100 dividend payers.
• Use our Morningstar Screener tool to find the best dividend stocks according to your specific criteria. You can search for stocks based on their dividend yields, valuation measures such as price/earnings, and more.
• Use Morningstar Portfolio Manager to build a watchlist of the best dividend stocks and create a view that allows you to easily follow the valuations, ratings, and dividend yields of the stocks in your list.
• When it comes to buying stocks, it’s more than just dividends. Read here how valuations and competitive advantages – known as economic moats – matter when it comes to a stock’s potential for outperformance.
• Watch this video to learn how Morningstar uses the star rating, moat rating and other metrics to evaluate stocks.
Companies that are not formally covered by a Morningstar analyst are statistically matched to analyst-rated companies, allowing our models to calculate a quantitative star rating.
This article was compiled by Bella Albrecht, edited by Lauren Solberg, and reviewed by Sunniva Kolostyak.
This article was generated with the help of automation and reviewed by Morningstar editors.
