HSBC Holdings And 2 Other Leading UK Dividend Stocks

The market is up 2.7% in the last 7 days, with all sectors gaining ground. In the last year, the market has climbed 8.8%, and earnings are expected to grow by 13% per annum over the next few years. In this favorable environment, investing in strong dividend stocks like HSBC Holdings can provide both income and potential for capital appreciation.

Top 10 Dividend Stocks In The United Kingdom

Name	Dividend Yield	Dividend Rating
Impax Asset Management Group (AIM:IPX)	6.73%	★★★★★☆
Big Yellow Group (LSE:BYG)	3.80%	★★★★★☆
Keller Group (LSE:KLR)	3.03%	★★★★★☆
Plus500 (LSE:PLUS)	5.63%	★★★★★☆
DCC (LSE:DCC)	3.67%	★★★★★☆
Dunelm Group (LSE:DNLM)	6.29%	★★★★★☆
NWF Group (AIM:NWF)	4.52%	★★★★★☆
Hargreaves Services (AIM:HSP)	6.25%	★★★★★☆
Grafton Group (LSE:GFTU)	3.38%	★★★★★☆
James Latham (AIM:LTHM)	5.20%	★★★★★☆

Click here to see the full list of 57 stocks from our Top UK Dividend Stocks screener.

Below we spotlight a couple of our favorites from our exclusive screener.

HSBC Holdings

Simply Wall St Dividend Rating: ★★★★☆☆

Overview: HSBC Holdings plc provides banking and financial services worldwide and has a market cap of approximately £128.30 billion.

Operations: HSBC Holdings plc generates revenue from four primary segments: Corporate Centre ($3.33 billion), Commercial Banking ($19.43 billion), Global Banking and Markets ($15.80 billion), and Wealth and Personal Banking ($24.34 billion).

Dividend Yield: 6.7%

HSBC Holdings offers a compelling dividend yield of 6.74%, placing it in the top 25% of UK dividend payers. The current payout ratio of 52.7% suggests dividends are well-covered by earnings, with future coverage forecasted at 51.8%. However, HSBC's dividend history is volatile and has been paid for only eight years, indicating some unreliability. Recent leadership changes, including appointing Jon Bingham as Interim CFO and Georges Elhedery as CEO, may impact future stability and strategy.

• Take a closer look at HSBC Holdings' potential here in our dividend report.

• Our comprehensive valuation report raises the possibility that HSBC Holdings is priced lower than what may be justified by its financials.

LSE:HSBA Dividend History as at Aug 2024

Pets at Home Group

Simply Wall St Dividend Rating: ★★★★★☆

Overview: Pets at Home Group Plc operates as a specialist omnichannel retailer of pet food, pet-related products, and pet accessories in the United Kingdom with a market cap of £1.41 billion.

Operations: Pets at Home Group Plc generates revenue through its Retail segment, which brought in £1.33 billion, and its Vet Group segment, which contributed £146.50 million.

Dividend Yield: 4.2%

Pets at Home Group's dividend yield of 4.17% is reliable, with payments well-covered by earnings (77.2%) and cash flows (36.3%). Despite a slight decline in net income to £79.2 million, the company has maintained stable dividends over the past decade. Recent news includes a final dividend declaration of 8.3 pence per share and significant insider selling over the last quarter, which could be a point of concern for some investors.

• Click here to discover the nuances of Pets at Home Group with our detailed analytical dividend report.

• The valuation report we've compiled suggests that Pets at Home Group's current price could be quite moderate.

LSE:PETS Dividend History as at Aug 2024

Whitbread

Simply Wall St Dividend Rating: ★★★★☆☆

Overview: Whitbread plc operates hotels and restaurants in the United Kingdom, Germany, and internationally, with a market cap of £5.19 billion.

Operations: Whitbread plc generates revenue from its accommodation and food and beverage segments, totaling £2.96 billion.

Dividend Yield: 3.3%

Whitbread's dividend payments are well-covered by earnings (payout ratio: 60.3%) and cash flows (cash payout ratio: 46.9%). Although the dividend yield is relatively low at 3.33%, recent increases, including a final dividend of 62.9 pence per share, highlight growth potential. However, dividends have been volatile over the past decade, posing some reliability concerns. Recent buybacks amounting to £96 million and a slight sales increase to £739 million also reflect positive financial maneuvers.

• Dive into the specifics of Whitbread here with our thorough dividend report.

• Insights from our recent valuation report point to the potential undervaluation of Whitbread shares in the market.

LSE:WTB Dividend History as at Aug 2024

Make It Happen

• Click this link to deep-dive into the 57 companies within our Top UK Dividend Stocks screener.

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Curious About Other Options?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.

• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.

• Find companies with promising cash flow potential yet trading below their fair value.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include LSE:HSBA LSE:PETS and LSE:WTB.

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