2 UK shares to buy today for 8% dividends

Our writer has a list of UK shares to buy now for his portfolio. These two high-yielders make the list thanks to their long-term income potential.

| More on:
Elevated view over city of London skyline

Image source: Getty Images

The allure of passive income is as strong as ever in the current inflationary environment. Right now, quite a few companies have dividend yields I find attractive. I have a list of UK shares to buy for my portfolio that have appealing income potential. Here are two I have bought that both yield over 8% at the moment.

Abrdn

It is not an easy time to be in the fund management industry. As Jupiter said in its interim results yesterday, “the first half of 2022 has been particularly challenging”. That is true for the industry as a whole, with consumer anxiety and economic problems causing assets under management to fall at firms including Jupiter.

Rival Abrdn (LSE: ABDN) may struggle with such challenges in a similar way to Jupiter. We will find out next month when the company unveils its interim results. Meanwhile, the company has a dividend yield of 8.9%. I find that very attractive and as a shareholder in Abrdn already, certainly appreciate the dividend income I get from the firm.

I think the company’s reputation and brand can help it attract and retain clients. Financial services can be a lucrative sector as the sums involved are large, so even a small commission can make for healthy profits. The profit margins can also be very high. Last year, for example, Abrdn made a profit of £995m on revenue of £1.7bn. That is a 59% margin, which I think is excellent.

Navigating choppy economic waters could mean lower profits in coming years. But with a strong business foundation and customer base, I think Abrdn earns its place on the list of UK shares to buy now for my portfolio.

Imperial Brands

Another UK share with a yield close to 9% is tobacco producer Imperial Brands (LSE: IMB).

When it comes to growth, I see limited reasons for optimism here. Cigarettes are in long-term decline in many markets. Meanwhile, Imperial’s ambitions in non-cigarette products are more modest than those of rivals like British American Tobacco.

But cigarette sales have been declining for decades already yet remain highly cash generative. That could continue for a long time yet. Meanwhile, Imperial has been investing in marketing for key countries. It hopes that by building its market share it can achieve a slower rate of sales decline than the overall market.

All of that adds up to juicy dividends and currently the yield is 8.9%. A big cut in 2020 put the dividend on a more even footing. Imperial can sometimes feel like a company in its sunset years but that sunset may keep going for many decades. If I get a dividend yield of almost 9% for holding the shares, I do not mind Imperial’s lack of exciting growth prospects!

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 considered so you should consider taking independent financial advice.

Christopher Ruane owns shares in Abrdn, British American Tobacco, Imperial Brands, and Jupiter Fund Management. The Motley Fool UK has recommended British American Tobacco, Imperial Brands, and Jupiter Fund Management. 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

Business development to success and FTSE 100 250 350 growth concept.
Investing Articles

After a 10% price jump, is this a top FTSE 100 share to buy now?

I'm always on the lookout for my next share to buy. But I'd taken my eye off this one after…

Read more »

Smiling young man sitting in cafe and checking messages, with his laptop in front of him.
Investing Articles

2 of my top shares to buy before the market recovers!

The FTSE 100 may have closed above 7,500 earlier this week, but many stocks still haven't recovered. So, here are…

Read more »

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

2 FTSE 100 dividend shares I’ve bought with yields above 8%

As inflation rises, our writer is trying to earn passive income by owning dividend shares. Here are two he's bought…

Read more »

Warren Buffett at a Berkshire Hathaway AGM
Investing Articles

How I’d use the Warren Buffett method to profit from the next bull market

How can Warren Buffett's guidance help us to pick the most profitable companies to invest in over the next couple…

Read more »

young woman celebrating a victory while working with mobile phone in the office
Investing Articles

Here’s how much I’d have now if I’d invested £1k in Scottish Mortgage shares 5 years ago!

Scottish Mortgage shares came crashing down last year after a multi-year bull run. But would I have made money if…

Read more »

Mixed-race female couple enjoying themselves on a walk
Investing Articles

How I’m using £120 a month to aim for £12,500 a year in passive income!

Everyone wants to earn passive income, right? Well I'm looking to invest the money I don't need now, to generate…

Read more »

Close-up of British bank notes
Investing Articles

Here’s the Legal & General dividend forecast for 2022 and 2023

Legal & General has paid out some monster dividends in recent years. Here, Edward Sheldon looks at the dividend forecast…

Read more »

Female analyst sat at desk looking at pie charts on paper
Investing Articles

Is now the time to be snapping up Rolls-Royce shares?

Rolls-Royce shares have faced numerous setbacks in the recent past. However, could now be the time to buy? This Fool…

Read more »