The materials industry is deeply cyclical with producers benefiting highly during an economic boom and many players going bankrupt in a bust. Thus, there is ample opportunity to take advantage of improving economic conditions which has led to strong demand for commodities. Another key driver of a materials company’s profit is the commodity prices which in turn steers the level of dividend payouts and yield. Today I will share with you my list of high-dividend materials stocks you should consider for your portfolio.
Essentra plc (LSE:ESNT)
ESNT has a sizeable dividend yield of 3.95% and a reasonably sustainable dividend payout ratio , with analysts expecting a 64.10% payout in three years. Over the past 10 years, ESNT has increased its dividends from £0.0712 to £0.207. They have been consistent too, not missing a payment during this 10 year period.
Victrex plc (LSE:VCT)
VCT has a decent dividend yield of 2.04% and is currently distributing 46.22% of profits to shareholders , with analysts expecting the payout in three years to be 69.95%. VCT has increased its dividend from £0.173 to £0.538 over the past 10 years. They have been reliable as well, ensuring that shareholders haven’t missed a payment during this 10 year period.
DS Smith Plc (LSE:SMDS)
SMDS has a good-sized dividend yield of 2.97% and distributes 75.80% of its earnings to shareholders as dividends . While there’s been some level of instability in the yield, SMDS has overall increased DPS over a 10 year period from £0.086 to £0.152. DS Smith’s future earnings growth looks strong, with analysts expecting 61.92% EPS growth in the next three years.
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.