Are you looking for some more income in this low-interest environment? Check out these 10 High Yield European Stocks which have rewarded their shareholders with at least 10+ years of consecutive dividend increases.
European Dividend
In Europe, companies are more focused on paying out a certain percentage of their profits as dividends. Whereas in the US companies mostly have a dividend policy that focuses on consecutive years of increasing dividends. Furthermore, companies in Europe that pay quarterly dividends are rare. A final or interim dividend is more common to reward shareholders. Paying dividends once or twice per year is the default. For investors, the different dividend withholding taxes and reclaim processes are making it even more complex to figure out the real performance.
To generate a yearly income for your retirement, a high yield is interesting but please keep the yield-trap in mind.
We have selected 10 high yield European stocks for you with a dividend yield of more than 3.5% and were able to increase their dividends for at least 10 consecutive years.
10 High-Yield European Stocks
Here is our selection of 10 high yield European Stocks that are worthwhile to consider in a dividend income portfolio and a good starting point for further analysis for every dividend growth investor.
| Company | Country | Sector |
|---|---|---|
| Klepierre SA | France | Real Estate |
| Enagas, S.A | Spain | Utilities |
| Red Electrica Corp. | Spain | Utilities |
| Legal & General Group Plc | UK | Financial Services |
| Telenor ASA | Norway | Communication Services |
| BASF SE | Germany | Basic Materials |
| Koninklijke Ahold Delhaize N.V | Netherlands | Consumer Defensive |
| Sanofi | France | Healthcare |
| BAE Systems plc | UK | Industrials |
| Groupe Bruxelles Lambert SA | Belgium | Financial Services |
1. Klepierre SA
| Dividend Yield | 11.5% | Sector | Real Estate |
| Years Dividend Growth | 10 | Payout Ratio | 44.5% |
| 5 Yr Avg Dividend Growth | 6.6% | ISIN | FR0000121964 |
Klepierre is the European leader in shopping malls and combines development, property, and asset management skills. The company’s portfolio is valued at €22.8 billion on June 30, 2020 and comprises large shopping centers in 12 countries in Continental Europe which together host 1.1 billion visits per year. Like many European real-estate companies, Klepiere had a dividend 2020 due to COVID-19 dropping from around €32 to €19. This also explains part of the current high dividend yield.
2. Enagas
| Dividend Yield | 8.8% | Sector | Utilities |
| Years Dividend Growth |
21 | Payout Ratio | 95.2% |
| 5 Yr Avg Dividend Growth | 4.1% | ISIN | ES0130960018 |
Enagas, S.A. engages in the development, operation, and maintenance of gas infrastructures in Spain, Mexico, Chile, Peru, Albania, Greece, Italy, and the United States. The company operates approximately 11,000 kilometers of gas pipelines, 19 compressor stations, and 6 international connections. Enagas, S.A. was founded in 1972 and is headquartered in Madrid, Spain.
3.Red Eléctrica Corporación
| Dividend Yield | 6.5% | Sector | Utilities |
| Years Dividend Growth | 22 | Payout Ratio | 78.9% |
| 5 Yr Avg Dividend Growth | 7.0% | ISIN | ES0173093024 |
Red Eléctrica Corporación, S.A. transmits electricity and operates and manages transmission network for the electricity system in Spain and internationally. The company was founded in 1985 and is headquartered in Alcobendas, Spain.
4.Legal & General Group Plc
| Dividend Yield | 6.4% | Sector | Financial Services |
| Years Dividend Growth |
11 | Payout Ratio | 81% |
| 5 Yr Avg Dividend Growth | 8.9% | ISIN | GB0005603997 |
Legal & General Group Plc sells insurance products and other financial services. It transacts life assurance and longterm savings business, investment management, and general insurance and health business. The company was founded in 1836 and is based in London, the United Kingdom.
5.Telenor ASA
| Dividend Yield | 5.9% | Sector | Communication Services |
| Years Dividend Growth |
11 | Payout Ratio | 97% |
| 5 Yr Avg Dividend Growth | 3.7% | ISIN | NO0010063308 |
Telenor ASA, together with its subsidiaries, operates as a telecommunication company worldwide. Its principal products and services include mobile communication, fixed-line communication, and broadcasting services. The company’s mobile communication services comprise voice, data, internet, and content services, as well as customer equipment and messaging. Telenor ASA was founded in 1855 and is headquartered in Fornebu, Norway.
6.BASF
| Dividend Yield | 4.9% | Sector | Basic Materials |
| Years Dividend Growth |
10 | Payout Ratio | NA |
| 5 Yr Avg Dividend Growth | 3.3% | ISIN | DE000BASF111 |
German BASF SE operates as a chemical company worldwide. It operates through six segments: Chemicals, Materials, Industrial Solutions, Surface Technologies, Nutrition & Care, and Agricultural Solutions. ASF SE was founded in 1865 and is the largest chemical producer in the world. BASF’s share-price dropped due to Covid-19, but is almost back on the levels of early 2020. Due to negative earnings per share (impairments in 2020) at the moment, the payout ratio is not available.
7. Ahold Delhaize NV
| Dividend Yield | 3.9% | Sector | Consumer Defensive |
| Years Dividend Growth |
12 | Payout Ratio | 53% |
| 5 Yr Avg Dividend Growth | 9.6% | ISIN | NL0011794037 |
Koninklijke Ahold Delhaize N.V. operates retail food stores primarily in Europe and the United States. The company’s store formats include supermarkets, convenience stores, compact hypermarkets, cash and carry, drugstores, hypermarkets, and wine and liquor stores. Ahold Delhaize N.V. was founded in 1887 and is headquartered in Zaandam, the Netherlands.
8. Sanofi
| Dividend Yield | 3.9% | Sector | Healthcare |
| Years Dividend Growth |
25 | Payout Ratio | 35% |
| 5 Yr Avg Dividend Growth | 2.0% | ISIN | FR0000120578 |
Sanofi provides therapeutic solutions and worldwide it is the 7th largest Pharmaceutical company in the world by revenue (40.46 Bln). The company was formerly known as Sanofi-Aventis. Sanofi was incorporated in 1994 and is headquartered in Paris, France.
9. BAE Systems plc
| Dividend Yield | 3.8% | Sector | Industrials |
| Years Dividend Growth |
16 | Payout Ratio | 51% |
| 5 Yr Avg Dividend Growth | 3% | ISIN | GB0002634946 |
BAE Systems Plc. engages in the design, development, manufacture, and support of defense and aerospace systems used in the air, on land, at sea, and in space. The company was incorporated in 1979 and is based in London, the United Kingdom.
10. Groupe Bruxelles Lambert SA
| Dividend Yield | 3.8% | Sector | Financial Services |
| Years Dividend Growth |
20 | Payout Ratio | 51% |
| 5 Yr Avg Dividend Growth | 2.5% | ISIN | BE0003797140 |
Groupe Bruxelles Lambert SA invests in a portfolio of industrial and services companies operating in various sectors. The company operates through four segments: Holding, Imerys, Webhelp, and Sienna Capital. It operates in Belgium, other European countries, North America, and internationally. The company was founded in 1902 and is based in Brussels, Belgium.
For the complete picture here is the full list of the 10 high yield European stocks with a dividend yield of more than 3.5% and were able to increase their dividends for at least 10 consecutive years.
Final thoughts
This top-10 can serve as inspiration and starting point to investors who are looking for some additional high yield European stocks in their portfolio. The 10+ years consecutive years of dividend increases can give so comfort. However, the covid pandemic is not yet at its end and could impact the abovementioned companies and their dividend policy even when they do have a sound business model.
DISCLOSURE: We are long in all the abovementioned stocks, via our European dividend Aristocrats ETF.
Other Sources of Dividend Investment Ideas
There are several lists to quickly screen for businesses that regularly pay rising dividends.
- The Dividend Aristocrats Index is based on 64 companies part of the S&P 500 and with 25+ years of consecutive dividend increases.
- The Dividend Kings List is even more exclusive than the Dividend Aristocrats. It is comprised of less than 20 businesses with 50+ years of consecutive dividend increases.
- The MoneyInvestExpert Defensive Aristocrats is a performance-based top-10 selection of the Dividend Aristocrats to outperform the market in the long-term.
- Portfolio lists like the Berkshire Hathaway Portfolio or Bill Gates’stock portfolio can be a source.
- For the European focused investors, there is also the list of European Dividend Aristocrats.
- Dividend Champions are not necessarily members of the S&P 500 index, have increased their dividend for 25 or more consecutive years.
- 100+ years of dividend, the list of stocks that pay over 100 years of dividend can be a list of inspiration.
- Blue Chips stocks from the US or the European ones.
Next to selecting the right dividend stocks, important principles for successful long-term investing are Disciple, Diversification, Defensive & indeed Dividend. Read more about this in our free e-book.
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