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Image source: Getty Images <\/p>\n Image source: Getty Images <\/p>\n
Not all dividend stocks are the same. Some offer higher starting yields, while others have better growth prospects.<\/p>\n
Right now, I can see shares in each category for investors to consider. And they\u2019re not always the most obvious names.<\/p>\n
The FTSE 100 currently has a dividend yield of 3.3%. And Associated British Foods (LSE:ABF) is exactly in line with this.<\/p>\n
That makes the next question a straightforward one \u2013 is this an above-average business? I think it might be.<\/p>\n
The company\u2019s main asset is Primark. And while it\u2019s a retailer, it\u2019s important not to underestimate just how valuable it is.\u00a0Primark recently reported a fall in like-for-like sales across Europe. But that\u2019s not as significant as it might be.<\/p>\n
It certainly highlights a key risk. When consumer spending is weak, lower sales can lead to price cuts that weigh on margins.\u00a0Unlike the majority of publicly-traded retailers, though, Primark is still expanding rapidly. Especially in the US.<\/p>\n
The firm currently has around 38 stores in the US. But there\u2019s talk of this growing to over 100 by 2030, which is a big increase.<\/p>\n
While success isn\u2019t guaranteed, the early signs are promising. And there are also expansion plans in other countries.\u00a0That means Primark\u2019s growth isn\u2019t limited to like-for-like sales. And it\u2019s why I think dividend investors should take a look.<\/p>\n
Despite excess inventory in the UK housing market, affordability issues remain. Enter Grainger (LSE:GRI).<\/p>\n
Ultimately, housing is a basic need. And if people aren\u2019t in a position to buy \u2013 for whatever reason \u2013 they have to rent.<\/p>\n
The firm owns and leases residential properties. And it has 11,000 properties with 5,000 more in its pipeline for future growth<\/p>\n
In terms of the dividend, the situation is a little complicated. Grainger is becoming a real estate investment trust (REIT). That means the dividend will become mandatory. But the firm should benefit from tax exemptions on its rental income.<\/p>\n
Analysts think the result will be a yield of around 5.5%. And that might well be attractive in today\u2019s market.<\/p>\n
There\u2019s obviously a shortage of housing in the UK, so demand for Grainger\u2019s properties should stay strong. But there are risks. One of these is regulation. Shifting standards can result in higher costs and while Grainger is well-positioned right now, that could change.<\/p>\n
In terms of dividends, though, this looks like an interesting business in a durable industry. And I think it\u2019s worth a closer look.<\/p>\n
Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.<\/p>\n","protected":false},"excerpt":{"rendered":"Image source: Getty Images Not all dividend stocks are the same. Some offer higher starting yields, while others…\n","protected":false},"author":2,"featured_media":7501,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[3874,274,270,3871,3873,3872,5,6],"class_list":{"0":"post-7500","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-uk","8":"tag-dividend-investor","9":"tag-dividend-stocks","10":"tag-dividend-yield","11":"tag-foods","12":"tag-growth-prospects","13":"tag-primark","14":"tag-uk","15":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@UnitedKingdom\/116358532527742743","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts\/7500","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/comments?post=7500"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts\/7500\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/media\/7501"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/media?parent=7500"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/categories?post=7500"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/tags?post=7500"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}