4 dividend stocks to buy as inflation soars!

I’m hunting for the best dividend stock to invest in as global inflation soars. Here are several high-dividend-yield shares that have caught my attention.

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

A young woman sitting on a couch looking at a book in a quiet library space.

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

sdf

Investing in income stocks with a high dividend yield is one way I can reduce the impact of soaring inflation on my returns.

With this in mind, here are four high-dividend stocks from the London Stock Exchange I’m considering adding to my dividend portfolio.

Glencore (12.5% dividend yield)

FTSE 100 business Glencore produces and markets a broad range of commodities. It’s a great high-dividend stock for me to buy in this inflationary environment as materials such as copper, iron ore, nickel and lead tend to rise in value along with the products they’re used to create.

The danger of owning income shares like this is that mining problems can be common and destructive for profits. If Glencore can’t get its stubborn commodities out of the ground then revenues suffer.

However, I like this particular commodities business because of its extra role as a market supplier. This can help offset the impact of any potential trouble at its mines on an investors’ total return.

NextEnergy Solar Fund (7% dividend yield)

I think buying energy producers is always a good dividend investing idea during tough times. Electricity demand is essential and so demand remains broadly consistent at all points of the economic cycle. As a result dividend income tends to be more predictable.

It’s why I’m considering buying like NextEnergy Solar Fund, a dividend growth stock that invests in US renewable energy assets. I think earnings here could be particularly strong going forwards as the need for low-carbon energy grows.

Fortunately for this renewable energy stock, the US has some of the most favourable green legislation anywhere in the world. But it’s important to remember that changing laws could have a big impact on investor returns later on.

Vodafone Group (6.2% dividend yield)

Consumer spending is set to worsen in the months ahead as inflationary pressures intensify. But remaining connected through our broadband and mobile phones is something few of us will cut back on. Consequently, I’d buy Vodafone Group shares today.

I am concerned about the €41.6bn worth of net debt the Footsie company had on its books as of March. This could potentially damage its growth plans and reduce future dividends.

However, I believe its broad geographic presence also makes it an attractive stock to buy. Vodafone could thrive as global growth steadily boosts telecoms demand. This could support strong dividend growth over the long term.

Civitas Social Housing (7% dividend yield)

One of the last things people stop paying for when times get tough is accommodation. So profits at Civitas Social Housing are tipped by City analysts to keep rising even as the cost-of-living crisis intensifies, laying the path for additional dividend increases.

This stock offers an extra layer of security that many other property stocks don’t too. The rents it charges are paid by local authorities, meaning related income isn’t vulnerable to cyclical factors like a downturn in the labour market.

I’d buy Civitas even though problems with its acquisition-led growth strategy could harm investor returns. Such issues include competition for social housing properties.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended Vodafone. 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.

More on Investing Articles

Santa Clara offices of NVIDIA
Investing Articles

The Nvidia share price hit an all-time high this week. But could it still be a bargain?

The Nvidia share price has soared 1,466% in just five years. This writer reckons the best may yet be to…

Read more »

Young mixed-race couple sat on the beach looking out over the sea
Investing Articles

How much does someone need to invest to target a second income of £15k – or £150k?

A second income from dividend shares? It's a well-worn path -- and this writer sees some attractions to the approach.…

Read more »

Investor looking at stock graph on a tablet with their finger hovering over the Buy button
Investing Articles

Could the stock market crash in the second half of 2025?

As the FTSE 100 hits a new high, could a stock market crash be coming? Our writer thinks there's a…

Read more »

Man hanging in the balance over a log at seaside in Scotland
Investing Articles

Start investing this summer with a spare £250? Here’s how!

Christopher Ruane explains how an investor with a few hundred pounds to spare and no prior experience could look to…

Read more »

Young female analyst working at her desk in the office
Investing Articles

Is Palantir stock the new Nvidia? Why UK investors should (or shouldn’t) care

Palantir stock’s the top performer on the S&P 500 this year. Should UK investors consider it amid a blistering AI-fuelled…

Read more »

Investing Articles

3 FTSE 100 shares I think look undervalued

The FTSE 100 may be hitting record highs but there are still bargains to be had on the index. I…

Read more »

Close-up image depicting a woman in her 70s taking British bank notes from her colourful leather wallet.
Investing Articles

£20,000 in savings? Here’s how to target £841 of passive income each month

Passive income plans don't need to be complicated. Our writer explains how someone could target a sizeable second income buying…

Read more »

Happy couple showing relief at news
Investing Articles

3 passive income strategies I like to try to double the State Pension with just £100 a month

Investing consistently, with diligence, and patience can lead to an impressive stock market income that puts the State Pension to…

Read more »