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FTSE dividends to fall amid a buyback frenzy

Capital allocation calls have consequences for income investors
April 25, 2024
  • Analysts are expecting less from the FTSE 100 in terms of yield in the next year
  • The dividend increases we have seen are concentrated among a handful of companies

Unloved as it has been in recent years, the UK market has at least been a stalwart for dividend hunters. The FTSE 100 often tends to offer a yield of around 4 per cent, with something much juicier available from selected shares. Companies such as Lloyds Banking Group (LLOY) and Rio Tinto (RIO) offer yields north of 5 per cent, with others such as Vodafone (VOD) and British American Tobacco (BATS) recently on double-digit yields.

The income expected to come from the market does seem to be slipping, however, with AJ Bell's latest Dividend Dashboard report showing yield forecasts for the FTSE 100 falling back.

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