Regulated distribution utilities are among the most defensive investments available with solid cash flow, high dividend pay-out ratios, and low cyclicality. Therefore, these companies provide a strong reliable stream of constant income which is a great diversifier during economic downturns. If you’re a long term investor, these high-dividend utilities stocks can boost your monthly portfolio income.
Pennon Group Plc (LSE:PNN)
PNN has a sumptuous dividend yield of 4.71% and pays out 83.88% of its profit as dividends . PNN’s DPS have risen to £0.3596 from £0.1895 over a 10 year period. During this period, the company has not missed a dividend payment – as you would expect from a company increasing their dividend.
Severn Trent Plc (LSE:SVT)
SVT has a great dividend yield of 4.15% and is currently distributing 67.28% of profits to shareholders , with analysts expecting the payout ratio in three years to be 71.69%. SVT’s dividends have seen an increase over the past 10 years, with payments increasing from £0.6302 to £0.8655 in that time. They have been dependable too, not missing a single payment in this time. Severn Trent has managed to maintain a positive EPS growth percentage over the last five years.
United Utilities Group PLC (LSE:UU.)
UU. has a sumptuous dividend yield of 4.76% and is distributing 62.29% of earnings as dividends , with the expected payout in three years being 85.26%. Besides the potential capital gains, UU.’s yield alone is better than the low risk savings rate. Plus, a 4.76% yield places it amidst the market’s top dividend payers. Comparing United Utilities Group’s PE ratio against the Global Water Utilities industry draws favorable results, with the company’s PE of 13 being below that of its industry (16.7).
For more solid dividend payers to add to your portfolio, you can use our free platform to explore our interactive list of top dividend payers.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.