Dividend stocks continue to be of interest to me, which is why I’m taking a closer look at the income investing potential of National Grid plc (LON:NG) (NG.L), SSE PLC (LON:SSE) (SSE.L), Vodafone Group plc (LON:VOD) (VOD.L) and GlaxoSmithKline plc (LON:GSK) (GSK.L).
National Grid’s 6% dividend yield is one of the highest I can find in the Footsie at the moment. The company also offers a strong track record of reliable dividend growth, alongside a robust business model that has proved popular during volatile market conditions in prior years.
Although National Grid is arguably less popular than it was a few years ago due in part to heightened regulatory risk, I still think it could perform well in the long run on valuation grounds.
SSE also faces an uncertain outlook due in part to regulatory and political concerns. Nationalisation across the sector could be on the horizon if there is a change in government at the next general election.
Still, SSE continues to offer a relatively high dividend yield of over 7%. With the stock having the potential to raise dividends at the same pace as inflation, I feel it continues to offer dividend appeal.
GlaxoSmithKline’s 6% dividend yield seems to be relatively high given its future prospects. The company has a refreshed strategy which is set to focus on a smaller number of potential drugs. This could yield higher rewards and allow the company to resume dividend growth after a few years of them flat lining.
Since I’m bullish on the outlook for the healthcare sector, I feel that GlaxoSmithKline could offer an upbeat income investing future. Its defensive characteristics may appeal during a volatile time for the Footsie.
Vodafone continues to have a dividend yield of around 6% at the moment. The company could generate improving dividend growth in future as a result of its forecast growth rate in EPS, which is in the double-digits at the moment.
With the quad play sector offering growth potential for the stock following its investment in new products and in its network, Vodafone remains a strong investment opportunity in my eyes.