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 August 2024, the top-performing dividend-payers included specialty insurance firm Just Group (JUST), Bank of Cyprus (BOCH), and gambling giant Entain (ENT).
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 capitalization—for companies with a forward dividend yield of at least 1.5%, excluding real estate investment trusts.
The Best-Performing UK Dividend Stocks of August 2024
1. Just Group (JUST)
2. Bank of Cyprus (BOCH)
3. Entain (ENT)
4. Plus500 (PLUS)
5. Keller Group (KLR)
6. Next (NXT)
7. GSK (GSK)
8. Haleon (HLN)
9. Beazley Group (BEZ)
10. TP ICAP (TCAP)
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 2.7% over the past month and 18.4% over the past year.
The overall UK stock market, as measured by the Morningstar UK Index, was roughly flat on the month, but has risen 17.4% on the year.
Yields and Metrics for August's Best-Performing Dividend Stocks
Just Group
Specialty insurance firm Just Group rose 18.6% in August and gained 92.0% over the past 12 months. Trading at £1.40 per share, its stock has a forward dividend yield of 1.54%. Just Group pays investors a trailing 12-month dividend of 2p per share. The stock has a quantitative Morningstar Rating of 3 stars.
Bank of Cyprus
Bank of Cyprus rose 17.8% in August and gained 69.2% over the past 12 months. At £4.08 per share, its stock has a forward dividend yield of 5.06% and a trailing 12-month dividend of 22p per share. It has a quantitative Morningstar Rating of 3 stars.
Entain
Gambling company Entain gained 14.8% in August and fell 42.6% over the past 12 months. The stock's £6.39 price gives it a forward dividend yield of 2.88%. Entain pays investors a trailing 12-month dividend of 18p per share. The stock has a quantitative Morningstar Rating of 3 stars.
Plus500
Capital markets company Plus500 rose 13.7% in August and gained 92.1% over the past 12 months. Trading at £25.94 per share, Plus500 stock has a forward dividend yield of 2.55% and a trailing 12-month dividend of 63p per share. It has a quantitative Morningstar Rating of 3 stars.
Keller Group
Engineering and construction company Keller Group gained 12.5% in August and rose 122.1% over the past 12 months. Trading at £16.44 per share, its forward dividend yield is 2.89%. Keller Group pays investors a trailing 12-month dividend of 45p per share. It has a quantitative Morningstar Rating of 3 stars.
Next
Retail company Next gained 12.0% in August and rose 48.4% over the past 12 months. At £101.10 per share, Next stock has a forward dividend yield of 2.04% and a trailing 12-month dividend of £2.06 per share. It has a quantitative Morningstar Rating of 2 stars.
GSK
Pharmaceutical company GSK rose 10.6% in August and gained 23.6% over the past 12 months. Trading at £16.50 per share, GSK stock has a forward dividend yield of 3.62% and a trailing 12-month dividend of 59p per share. The stock, which has a wide economic moat, is moderately undervalued, trading 25% below its fair value estimate of £22 per share. It has a Morningstar Rating of 4 stars.
Haleon
Pharmaceutical company Haleon rose 9.8% in August and gained 20.4% over the past 12 months. Trading at £3.82 per share, Haleon stock has a forward dividend yield of 1.62% and pays investors a trailing 12-month dividend of 6p per share. The stock, which has a wide economic moat, is currently trading near its fair value estimate of £3.72 per share, leaving it with a Morningstar Rating of 3 stars.
Beazley Group
Insurance firm Beazley Group gained 9.7% in August and rose 40.0% over the past 12 months. The stock's £7.65 price gives it a forward dividend yield of 1.89%. Beazley Group pays investors a trailing 12-month dividend of 13p per share. The stock has a quantitative Morningstar Rating of 3 stars.
TP ICAP
Capital markets company TP ICAP rose 9.7% in August and gained 56.1% over the past 12 months. At £2.38 per share, TP ICAP has a forward dividend yield of 6.09% and a trailing 12-month dividend of 15p 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 capitalization) 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.
