Image Alt

The Investing Box

  /  Editor's Pick   /  Here are 5 LSE dividend stocks with yields over 8%

Here are 5 LSE dividend stocks with yields over 8%

Young female hand showing five fingers.

Savings account interest rates have risen significantly. However, they’re still well below some of the yields offered by dividend stocks on the London Stock Exchange (LSE).

With that in mind, here are five LSE shares with yields over 8% right now.


First up is global banking giant HSBC. It’s forecast to pay out 62.2 US cents per share in dividends for 2023. That puts the prospective yield at 8.4% at today’s share price and exchange rate.

Banks can be volatile stocks. That’s because they’re exposed to the global economy. However, I like the risk/reward here. For the first half of 2023, the group delivered a strong performance and management said it’s confident about the future.

Legal & General

Next, we have insurer Legal & General. The 2023 dividend forecast here is currently 20.3p per share, translating to a yield of about 9.3%.

Now, a very high yield can sometimes be a sign a dividend cut is on the horizon. However, that doesn’t appear to be the case here. Recently, the company raised its H1 payout by 5%. It also said it plans to keep increasing its dividend by 5% a year in the medium term.

Given the company continues to hike its payout, I think the stock is worth considering as an income play.


Another insurer with a monster payout is Aviva. Currently, its 2023 dividend forecast is 32.4p per share, equating to a yield of about 8.6%.

However, Aviva’s long-term dividend track record is a little patchy. Over the last decade, for example, the company has reduced its payout on several occasions.

But in recent years, the company has undergone a massive transformation programme. As a result, it’s now far more streamlined than it was.

This leads me to believe the shares are worth a look now.

British American Tobacco

Turning to the tobacco industry, there’s now a big payout on offer from British American Tobacco.

Currently, analysts expect the company to reward shareholders with a cash distribution of 239p per share for 2023. That puts the yield at 9.4%.

In today’s health conscious, ESG-focused world, British American Tobacco obviously faces some challenges. A huge debt pile (£37bn at 30 June) adds further complications.

However, the stock does look cheap right now. So it could turn out to be a decent investment from here.


Finally, we have telecoms giant Vodafone. It’s currently expected to pay out 8.2 euro cents per share in dividends for 2023. That equates to a yield of about 9.9%.

Now last year, Vodafone paid out 9 euro cents per share in dividends. So the forecast here suggests a lot of analysts believe a cut is coming. This adds uncertainty.

However, on the plus side, the company is working hard to improve its performance. And a recent trading update showed its plan could be working as revenue for Q2 was up 3.7% year on year.

In light of this top-line growth, I think the stock could be worth a closer look.

Investing in high yielders

It’s worth pointing out that dividends are never guaranteed. Every stock has its own unique risks and analysts’ forecasts aren’t always accurate.

Therefore, diversification is crucial when investing in high yielders.

Those looking for more income investing ideas can find plenty right here at The Motley Fool.

The post Here are 5 LSE dividend stocks with yields over 8% appeared first on The Motley Fool UK.

Our best passive income stock ideas

Do you like the idea of dividend income?

The prospect of investing in a company just once, then sitting back and watching as it potentially pays a dividend out over and over?

If you’re excited by the thought of regular passive income payments, as well as the potential for significant growth on your initial investment…

Then we think you’ll want to see this report inside Motley Fool Share Advisor — ‘5 Essential Stocks For Passive Income Seekers’.

What’s more, today we’re giving away one of these stock picks, absolutely free!

Get your free passive income stock pick

setButtonColorDefaults(“#5FA85D”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43A24A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#FFFFFF”, ‘color’, ‘#FFFFFF’);

More reading

  • Is it worth buying the likely 4 promoted FTSE 100 shares?
  • Here are 2 of my best stocks to buy for passive income
  • After a week of FTSE 100 falls, is it time to buy the dip?
  • Is this government-backed FTSE 100 bank a buy for high passive income?
  • How to target a £500 a month passively with dividend shares

Ed Sheldon has no position in any of the shares mentioned. The Motley Fool UK has recommended British American Tobacco P.l.c., HSBC Holdings, and Vodafone Group Public. HSBC Holdings is an advertising partner of The Ascent, a Motley Fool company. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.