7%+ yields! 3 FTSE 100 and FTSE 250 dividend stocks I’d buy to target HUGE passive income in 2024

Good news! These UK blue-chip shares (including one from the FTSE) offer some of the biggest dividend yields on the London Stock Exchange.

| More on:

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.

Young woman holding up three fingers

Image source: Getty Images

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.

I’m searching the FTSE 100 and FTSE 250 for the best stocks to buy for passive income next year.

2024 could be another tough year for the global economy as inflationary pressures linger and China’s economy cools. So here I’m looking for companies with strong balance sheets and highly defensive operations.

Based on current dividend forecasts, £10,000 invested equally in these UK shares could make me a second income of £787 in 2024. Here’s why I’m looking to buy them for my own portfolio at the next opportunity.

Bluefield Solar Income Fund Limited

Energy demand remains broadly constant at all points of the economic cycle. So purchasing shares in an energy producer or power grid specialist could be a good idea in the current climate.

Bluefield Solar Income (LSE:BSIF) is one such company on my radar. This FTSE 250 stock, which has invested in approximately 200 solar farms across the UK, has a stable flow of income that it can use to finance large dividends every year.

City analysts are expecting the fund to pay another 8.6p per share reward in this financial year (to June 2024). This results in a gigantic 7.5% dividend yield.

Of course, forecasts don’t always turn out to be correct. And adverse weather conditions are a constant threat to renewable energy stocks. But I’m still expecting dividends here to steadily increase along with demand for clean energy.

Target Healthcare REIT

Care home owners like Target Healthcare REIT (LSE:THRL) are having to navigate the problem of nursing shortages. But strong tenant demand — driven by the UK’s rapidly growing elderly population — mean trading should remain stable over the near term.

For this financial year (to June 2024), the FTSE 250 firm offers a 7.2% dividend yield.

There are several reasons why I think Target is a solid dividend stock for 2024. Its asset portfolio of nearly 100 properties is let out to 32 different companies. This ensures that difficulties with one or two tenants doesn’t significantly impact profits at group levels.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

Finally, Target’s occupants are also tied down on long-term tenancy agreements. The weighted average unexpired lease term (or WAULT) stood at an impressive 26.3 years as of June. This is one of the highest readings among the UK’s real estate investment trust (REIT) sector.

Legal & General Group

Financial services giant Legal & General (LSE:LGEN) is also tipped to continue paying big dividends by City analysts. Its yield for 2024 sits at a FTSE 100-busting 8.9%

Revenues here could stagnate if the global economy remains weak. But a strong balance sheet means it should still remain an impressive passive income stock. As a shareholder myself, I’m soothed by the company’s cash-rich balance sheet.

Legal & General’s Solvency II capital ratio actually rose to 230% as of June. There’s also a possibility that the firm could launch a share buyback programme in the near future to return more of its excess cash.

This is a share I plan to hold for the long term. Demographic trends mean profits and dividends here should rise steadily during the next decade.

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 positions in Legal & General Group Plc and Target Healthcare REIT Plc. The Motley Fool UK has no position in any of the shares mentioned. 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

Three signposts pointing in different directions, with 'Buy' 'Sell' and 'Hold' on
Investing Articles

Looking for value stocks? Here’s 1 I’d buy and 1 I’d avoid!

This Fool delves deeper into two value stocks she’s had her eye on and explains why she’s bullish on one,…

Read more »

Young black woman using a mobile phone in a transport facility
Investing Articles

With the Airtel Africa share price in pennies, is it a bargain?

With the Airtel Africa share price having slumped by a quarter in just one month, this shareholder considers some of…

Read more »

Asian man looking concerned while studying paperwork at his desk in an office
Investing Articles

Are these 2 defensive FTSE 100 stocks shrewd buys after recent updates?

This Fool takes a closer look at these FTSE 100 stocks. She admires their defensive traits -- but does that…

Read more »

Portrait of elderly man wearing white denim shirt and glasses looking up with hand on chin. Thoughtful senior entrepreneur, studio shot against grey background.
Investing Articles

The FTSE 100 closes up after full-year results from leading UK firms – are they buys?

Earnings season brings about a lot of ups and downs for the FTSE 100. Yesterday had some particularly good releases,…

Read more »

artificial intelligence investing algorithms
Investing Articles

Should I buy NVIDIA stock as a British investor?

NVIDIA stock is up two-thirds this year alone. Our writer considers some pros and cons, specifically given that he is…

Read more »

Investing Articles

With £2,000 in excess savings, I’d buy 41 shares in this Warren Buffett dividend stock

Stephen Wright thinks one of the best dividend shares to buy right now might be a Warren Buffett stock that’s…

Read more »

Investing Articles

How many Aviva shares do I need to collect a £100 monthly income?

Aviva shares are well suited for passive income purposes. Our writer works out how many would be needed for a…

Read more »

Group of young friends toasting each other with beers in a pub
Investing Articles

£2k to invest? I’d buy 883 shares of this overlooked dividend giant for a second income

This FTSE 100 dividend stock has had a mixed time since floating in 2019 but it looks like a brilliant…

Read more »