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Dividend shares are sensible as a result of they provide revenue on prime of any capital progress when the share worth rises. Successfully, buyers get two bites of the identical cherry.
Even when a share worth stalls, the dividend nonetheless rewards buyers for his or her loyalty. And if the worth dips, reinvested dividends might decide up extra shares at a decrease degree, which might actually repay once they get well.
As an enormous fan of FTSE 100 revenue shares, I used to be intrigued to see Chris Beauchamp, chief market analyst at IG Group, spotlight three “dividend stars” to look at, citing their constant, well-supported dividends.
They’re all firms I like, providing among the most secure shareholder payouts on the FTSE 100, alongside potential progress. There are not any ensures this can proceed, however I believe all three are price contemplating for a balanced Shares and Shares ISA or Self-Invested Private Pension (SIPP).
HSBC gives revenue and progress
Beauchamp’s first decide is HSBC Holdings (LSE: HSBA). He says the Asia-focused financial institution has “rebuilt its popularity as a reliable revenue inventory, steadily lifting dividends over the previous 5 years”.
At this time, it has a trailing yield of simply over 5%, supported by robust income and capital self-discipline. As Beauchamp places it: “Traders get a stable and sustainable revenue stream with out extreme threat”.
HSBC has additionally delivered luggage of progress, the share worth up 48% previously 12 months and 202% over 5 years.
Regardless of that, the shares stay moderately valued, with a price-to-earnings (P/E) ratio of 10.5. Dangers embrace falling rates of interest, which may squeeze margins, and US-China commerce tensions. However long-term the rewards seem to justify taking them.
Aviva shares have flown
Subsequent is insurer Aviva (LSE: AV). Its shares are up 41% over one yr and 152% over 5. The trailing yield is 5.3%, regardless of the robust run.
Beauchamp highlights its “streamlined enterprise and robust money technology”. Payouts are well-covered and backed by wholesome capital reserves, providing a reliable revenue stream, he says.
I’d echo that. Below CEO Amanda Blanc, Aviva’s turn into a leaner, extra environment friendly operation. The shares at the moment are wanting dear with a P/E of 28 although, whereas a broader inventory market crash may hit flows into its asset administration division. However I believe it’s price contemplating with a long-term view.
Sainsbury’s appears tasty too
J Sainsbury is a FTSE 100 darkish horse, overshadowed by sector chief Tesco. But its shares have risen 25% over one yr and 65% over 5.
The yield’s lowest of the three although at 2.8%. The payout was frozen at 13.1p per share in 2023 and 2024, earlier than growing by 3.82% to 13.6p in 2025. Margin strain from grocery worth wars, inflation and rising employees prices are a priority.
The shares are pricier than the opposite two with a P/E of 14.75. Beauchamp notes “resilient buying and selling and robust money circulate”, with payouts underpinned by effectivity good points and regular grocery demand. Let’s hope the cost-of-living disaster eases, and consumers can spend extra.
All three revenue heroes provide a mix of revenue and progress, with comparatively protected payouts, making them worthy issues. They might not be the very most secure dividend shares on the FTSE 100, however I believe they’re fairly shut. Traders ought to take a long-term view to journey out any short-term volatility and let dividends compound over time.
