London’s junior stock market mostly consists of smaller companies where dividends can be less predictable. They don’t boast the strong balance sheets, economies of scale, or operational resilience that FTSE 100 businesses often enjoy.

However, AIM stocks can sometimes grow their dividends more sharply as their earnings take off. Furthermore, not all AIM companies are market minnows. Some of them are stable, large-cap companies who choose to stay off the UK’s main market because of the lighter regulatory landscape.

With this in mind, let’s see how investors could make a regular £1,000 passive income with a portfolio of AIM shares.

Green giant

Renewable energy provider Greencoat Renewables (LSE:GRP) could be a good place to start. Electricity demand remains largely constant at all point of the economic cycle, providing companes like this with excellent earnings visibility and reliable cash flows to fund dividends.

On the downside, unfavourable weather conditions can significantly impact electricity generation and consequently revenues. However, Greencoat’s wide geographical footprint helps reduce (if not totally eliminate) this danger. Its 40-strong asset portfolio takes in Ireland, Germany, Sweden, France, and Spain, protecting power generation from localised issues.

I expect dividends here to rise strongly over the long term as demand for greener energy increases. It’s returned €350m worth of cash to shareholders since its initial public offering (IPO) in 2017, and has earmaked another €383m worth between now and 2029.

For 2025, the company’s dividend yield is an enormous 9.5%.

Other AIM stocks to consider

Asset manager Polar Capital‘s another high-yielder worth serious consideration. Its forward yield is 10%, and it could deliver sustained payout growth as financial services demand steadily grows. Be mindful that economic turbulence could cause temporary earnings issues.

Insolvency specialist Begbies Traynor is also sensitive to economic conditions, albeit for different reasons. But its commitment to acquisitions could still deliver strong long-term returns. The forward dividend yield here is 3.7%.

I believe Wynnstay‘s 4.8% yield merits a close look too. While exposed to commodity price volatility, its animal feed and agricultural businesses offer the potential for steady growth.

Rounding off our mini portfolio, I’m also confident Michelmersh Brick — which carries the same near-5% yield — could overcome interest rate pressures and grow profits and dividends as housebuilding activity ramps up.

Thinking long term

No dividend is ever set in stone. And shareholder payouts from AIM shares can in theory be more volatile from year to year.

But this is where a diversified portfolio like the one I’ve laid out comes in. Spreading one’s exposure across sectors and regions can boost the stability of one’s passive income over time.

I believe the 6.6% average dividend yield across this mini portfolio makes it worth serious consideration. A £182,000 investment fund spread equally across these income stocks could generate a monthly passive income of £1,000.

Most people don’t have a spare £182k knocking around. But a fund of this size could be achieved with a £500 monthly investment over 15-and-a-half years, assuming an average annual return of 8%.

The post Here’s a portfolio of 5 AIM shares for a shot at a £1k monthly passive income! appeared first on The Motley Fool UK.

Targeting stable dividends

I think renewable energy stocks like Greencoat Renewables (LSE:GRP) have considerable growth opportunities as the push towards net zero continues.

The world’s energy needs are growing, and green sources are having to make up a growing portion of the overall mix as the world reduces fossil fuel use. The outlook for the sector is especially bright in Europe — Greencoat believes the continent’s renewables market will be worth €1.3trn by 2030, and will swell to €2.5trn by 2050.

What I like about this particular stock is its wide geographical footprint. Energy production from renewable sources is highly sensitive to weather conditions. Owning assets that are located hundreds of miles apart helps smooth out varabilities in energy output.

This is essential to support stable cash flows, which are used to fund dividends. It’s not enough to just be operating in the defensive energy sector where demand remains stable. Companies need operational resilience to capitalise on this.

Greencoat Renewables has demonstrated such durability. It’s raised annual dividends each year since it listed eight years ago, excluding 2021, when payouts were frozen. In total, it’s delivered €350m of cumulative dividends over the period.

What’s more, its dividend yields have long beaten the long-term average for UK shares. At 8.7%, the forward yield for Greencoat is more than double the FTSE 100‘s historical average of 3%-4%, for instance.

Of course, there are dangers here, such as changing green energy policy and rising project costs. A focus on wind farms also leaves it more technologically concentrated than some other renewable energy stocks. But I still believe it’s a top dividend share to consider for at least the next decade.

A FTSE favourite

FTSE 100-listed M&G (LSE:MNG) is another British stock with a huge market opportunity today.

It doesn’t enjoy the (overall) year-to-year stability that renewable energy shares enjoy. As a major financial services provider, its earnings are vulnerable to the economic downturns that can drain consumer spending power.

But over a long-term horizon, it has considerable scope to grow earnings. Rapidly ageing populations are supercharging demand for protection, investment, and retirement products, and asset management services. The UK asset management sector, for instance is set to grow 13.4% a year between now and 2030, according to Mordor Intelligence.

While competitive threats remain, I feel M&G has the brand power and the scale to thrive in this environment. This, in turn, bodes well for dividends, which have grown every year since the company listed in 2019.

For 2025, the Footsie company carries an enormous 7.7% dividend yield. This is currently the fifth highest on the UK blue-chip index, and is underpinned by the firm’s robust balance sheet.

Thanks to its excellent cash generation, M&G’s Solvency II capital ratio was 223% as of December. This should give it ample financial firepower to keep paying large dividends while also investing for growth. Remember that dividends are never guaranteed.

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As you’ll see, their forward dividend yields are more than double the average for FTSE 100 shares.

Greencoat Renewables

Dividend yield: 8.3%

The stable nature of energy demand provides trusts investing in power-generating assets with excellent stability. As a consequence, they have the means and the confidence to pay decent and often growing dividends over time.

This is the case with Greencoat Renewables (LSE:GRP), which specialises in onshore and offshore wind across Ireland and Continental Europe. It’s provided a growing annual payout in six of the past seven years.

Unfavourable weather conditions can significantly impact returns from these companies. When the wind doesn’t blow, for instance, their turbines can’t produce profit-making electricity.

However, Greencoat Renewables’ wide geographic footprint reduces the impact of localised weather issues at group level, providing earnings (and thus dividends) with excellent stability.

The trust predicts Europe’s investible renewables market will be worth €1.3trn by 2030, and €2.5trn by 2050. This suggests enormous long-term investment potential.

Supermarket Income REIT

Dividend yield: 8.9%

Trusts that specialise in food retail also enjoy excellent earnings stability from year to year. This is what can make Supermarket Income REIT (LSE:SUPR) such a great investment for risk-averse income seekers.

Today it owns 73 grocery properties that it lets out to some of the industry’s biggest players. These include Tesco, Sainsbury‘s, Aldi, and Morrisons. Needless to say, Supermarket Income doesn’t have to worry about rent collection problems with blue-chip tenants like these.

The steady growth of e-commerce poses a structural threat to the trust. However, its focus on omnichannel supermarkets servicing both physical and online customers is — for the time being, at least — helping to mitigate this threat.

One final reason I like Supermarket Income is because of its classification as a real estate investment trust (REIT). REITs are obligated to pay at least 90% of annual rental profits out in the form of dividends, whether they like it or not.

This provides dividend-hungry investors with added peace of mind.

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.

CVC Income & Growth

Dividend yield: 8.4%

The London stock market hosts plenty of trusts that derive their earnings from debt instruments. However, CVC Income & Growth‘s (LSE:CVCG) focus on sub-investment-grade credit means it can charge far higher interest rates than other trusts, supercharging the earnings it makes.

This in turn fuels its enormous dividend yields.

Returns here can be at risk if one or more companies fail to meet their debt obligations. However, the trust’s impressive diversification means such events can be absorbed without decimating total returns.

CVC Income & Growth has investments in between 40 and 60 companies at any one time. And these are pretty evenly spread across a wide variety of sectors and regions, a quality that reduces risk still further.

Like Supermarket Income and Greencoat Renewables, I think it’s worth serious consideration from savvy investors.

The post 8%+ dividend yields! 3 investment trusts to consider for enormous passive income appeared first on The Motley Fool UK.

The average dividend yield for Footsie shares stands at 3.6%. As you can see, the yields on these UK shares sail past this figure, and then some:

If analysts estimates are right, a £20,000 lump sum investment spread equally across these stocks will produce a £1,640 passive income next year.

I’m confident, too, that they could deliver a large and growing dividend beyond 2025 as well. Here’s why I think they’re worth considering right now.

Legal & General

With a dividend yield just below 10%, Legal & General is tipped to be one of the FTSE 100’s most generous income stocks next year.

There is peril here. The predicted dividend for 2025 is covered just 1.1 times by expected earnings, below the widely accepted security benchmark of two times.

Theoretically, this means dividends could fall below estimates if profits disappoint. However, Legal & General’s stunning cash generation means it still looks in good shape to meet City expectations.

As of June, its Solvency II capital ratio was 223%. This is more than double what regulators require. It’s also higher than those of Aviva, M&G, and Phoenix Group, other high-yielding financial services stocks.

With interest rates falling, I’m expecting profits and dividends to steadily rise as consumer demand improves.

Greencoat Renewables

Renewable energy stocks like Greencoat Renewables don’t face the same cyclical dangers as the likes of Legal & General. Demand for their product remains stable from year to year.

Yet shares like this still carry threat. For example, power generation — and by extension, earnings and dividend payments — can suffer when solar radiation is poor and the wind fails to blow.

I believe this threat is reduced with this particular FTSE 250 operator, however. With assets spanning Ireland and much of Continental Europe, the impact of unfavourable weather in particular regions is greatly diminished at group level.

Greencoat Renewables is also highly cash generative, which bodes well for future dividends. Its net cash generation during the first half of 2024 was three times the amount of dividends it paid out.

ITV

Earnings at broadcaster ITV have slumped in recent years as advertising spending dried up. Weak ad sales remain a threat going forwards, though the danger is reducing as interest rates begin to fall.

Today, City analysts expect profits at the FTSE firm to rise strongly through to 2026 at least. A recovery in advertising budgets, continued progress at its ITVX streaming platform, and post-strike conditions at ITV Studios all underpin their strong projections.

Against this backcloth, dividends are tipped to jump too. And with predicted payouts covered 1.9 times by anticipated earnings, dividend estimates also look well protected.

A strong balance sheet also supports ITV’s tasty dividend estimates. The firm’s net debt to adjusted EBITDA ratio was just 0.9 times as of June.

The post Fancy a £1,640 second income in 2025? These FTSE 100 and FTSE 250 shares could deliver it appeared first on The Motley Fool UK.

In the UK, dividend taxes are not insignificant. And they escalate considerably, according to an individual’s income tax band:

A yearly dividend tax allowance of £500 is applied before taxes are taken. But this has fallen considerably in recent years and could continue to do so.

I’m also likely to see a big bite taken out of my eventual return, regardless of this allowance. Let me show you why investing in an ISA can be so important for building wealth.

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. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Big tax savings

The following high-yield dividend shares are near the top of my shopping list for when I next have cash to invest:

• Greencoat Renewables (LSE:GRP), which has a forward dividend yield of 7.2%
• Phoenix Group, whose forward dividend yield’s 9.5%
• HSBC, which has a prospective dividend yield of 8.9%

If broker forecasts prove correct, a £20,000 lump sum investment spread across these UK shares would provide me with a £1,700 passive income.

If held within an ISA, I’d pay £0 in dividend tax to HM Revenue and Customs. However, if I were a basic rate taxpayer I’d have to pay £105.

As a higher-rate or additional-rate taxpayer, I’d be liable for a much higher £405 and £472.20 respectively.

It’s important to remember too, that these payments are due each and every year. If these companies maintain or grow their dividends, I could end up paying tens of thousands of pounds in dividend tax over a few decades.

3 top dividend shares

So if I had a spare £20k floating about, I’d max out my annual ISA allowance and add them to my portfolio that way. But why would I buy these specific stocks, you ask?

In the case of HSBC, I think it has considerable long-term investment potential due to its focus on fast-growing Asia. Economic problems in China may dent earnings growth in the immediate future. But I feel the future here’s bright as population sizes and wealth levels boom in its emerging markets.

I also like Phoenix Group as a way to capitalise on the UK’s growing elderly population. While it faces considerable competitive pressures, it has a chance to supercharge profits as pension sales rise.

I’m especially interested in buying Greencoat Renewables shares this October, which operates clean energy assets across Ireland and in parts of Continental Europe.

With inflation toppling across the eurozone, it could receive a big boost to earnings if the European Central Bank (as expected) ramps up interest rate cuts.

Furthermore, Greencoat has considerable long-term investment potential too, as demand for solar energy rockets in response to the escalating climate crisis.

Having said that, the profits it makes could suffer at times when unfavourable weather conditions emerge.

But on the whole, I think it could be a reliable dividend payer over time, as its history of paying above-average dividends since 2017 shows. This is thanks in large part to the defensive nature of its operations.

I think it’s a top dividend share for ISA investors to consider.

The post Why I’d buy these 7%+ yielding dividend shares in my Stocks and Shares ISA! appeared first on The Motley Fool UK.

Going green

Sustainable energy stock Greencoat Renewables (LSE:GRP) offers attractive all-round value at 95 euro cents per share.

The company trades at a healthy 15% discount to its net asset value (NAV) per share of 111.4 euro cents. It also currently carries a 7.3% forward dividend yield, more that double the FTSE 100 average of 3.6%.

Clean energy shares like this have considerable investment potential as the transition from fossil fuels accelerates. A strong balance sheet’s enabling Greencoat to capitalise on this opportunity too, while also continuing to pay large dividends.

Last month, the firm acquired a 50% stake South Meath Solar Farm in County Meath, Ireland.

I know that earnings at renewable energy producers can fluctuate during periods of unfavourable weather. At times like these, energy output can drop sharply. But from a long-term perspective, I believe Greencoat could still deliver a great return.

Pawn star

Pawnbrokers such as Ramsdens Holdings (LSE:RFX) might be ideal stocks to own in 2024. Not only are their services likely to remain in high demand as the UK economy struggles, but people are also taking advantage of the soaring gold price right now to trade in their valuables.

That’s not to say I think the business is just a ‘flavour of the month’ company to own however. As it rapidly expands — it’s added another eight stores to its portfolio since last October — Ramsdens is laying the groundwork for solid long-term growth.

Regulatory changes by the Financial Conduct Authority may impact future growth for the pawnbroking sector. But right now, Ramsdens seems to be sitting pretty.

Today, the firm trades on a forward price-to-earnings (P/E) ratio of 9.4 times. It also carries a tasty 4.9% dividend yield.

China in your hands

China’s current economic problems pose a problem to the region’s banks like HSBC Holdings (LSE:HSBA). Continued struggles in the domestic property market in particular are causing headaches across the sector.

It’s my opinion though, that these issues are more than baked into the company’s share price. It trades on a forward P/E ratio of 6.4 times.

In fact, with HSBC shares also carrying a huge 9.4% dividend yield, I think the bank could be one of the FTSE 100’s greatest value shares.

As a patient investor, I’m prepared to take some temporary pain if the long-term outlook’s attractive. And I think this Asia-focused bank has an exceptional opportunity to grow profits as financial services demand takes off.

Research from McKinsey & Company underlines HSBC’s enormous potential. The organisation expects bank sector revenues in Asia to rise around 7-8% over the next five years alone.

By reallocating investment to this emerging market from its traditional territories, HSBC’s putting itself in the box seat to exploit this opportunity too. In June, it snapped up Citi’s retail wealth management portfolio in mainland China.

The post 3 mega-cheap dividend shares to consider in September! appeared first on The Motley Fool UK.

Goldman Sachs now puts the chances of a US recession at 25%, up from 15% previously. JPMorgan’s even more pessimistic after last week’s poor jobs data. It puts the odds at just 35%, up from 25%.

This suggests that investors depending on dividend income, whether for their investment strategy or daily needs, should carefully consider which stocks to choose.

In this environment, it might be wise for me to focus on companies that have:

• Robust positions in sectors that are largely unaffected by the economy, such telecommunications, utilities, defence, healthcare and consumer staples
• Strong balance sheets, typified by low debt levels and healthy cash flows
• Moderate dividend payout ratios, for instance between 40% and 60%. This might provide scope for dividends to be maintained (or increased) even if profits fall
• Competitive advantages (‘economic moats’) that help them remain profitable even in difficult times. Examples include strong brands, patented products, and cost advantages

A £1,220 second income

This narrows the number of stocks I have to choose from. However, it doesn’t mean I don’t have good opportunities to make a strong passive income.

There remain hundreds of top UK stocks in good shape to pay a large (and potentially growing) dividend regardless of economic conditions. Here are just two of them:

If broker forecasts are correct, a £20,000 lump sum invested equally across these shares would provide an £1,220 passive income over the next 12 months.

Here’s why I’d buy them if I had spare cash to invest.

The PRS REIT

The PRS REIT’s a rock-solid income stock, in my book. It’s maintained dividends even during the ongoing cost-of-living crisis. And in the current financial period (to June 2025) it’s tipped to start growing them again.

This is thanks to its focus on the residential property market. Demand for housing remains stable at all points of the economic cycle. In fact, the business is benefitting from strong rental income growth as property shortages persist. Like-for-like rents here jumped 11.7% in the three months to June.

Real estate investment trusts (REITs) like this have to pay 90% of annual rental earnings or more out in dividends, which bodes well for future payouts. However, I’ll bear in mind that profits could suffer if interest rates fail to fall from current 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.

Greencoat Renewables

Electricity, like accommodation, is another essential commodity whose demand remains broadly unchanged over time. So I think Greencoat Renewables could be another sound investment in these uncertain times.

This business predominantly operates wind farms in Ireland, though it also owns renewable energy assets in parts of Mainland Europe. With investment in clean energy heating up, I think the company could be a great buy for long-term dividend growth as well.

I’m concerned about the prospect of rising costs at Greencoat Renewables. Keeping wind turbines in working order is famously expensive, and this could put a dent in earnings. But, on balance, I think it could prove to be a top buy for me.

The post 2 dividend stocks I’d buy to target a £1,220 passive income even during a recession! appeared first on The Motley Fool UK.

Two of my favourite dividend shares are shown in the table below. As you can see, each trades on a super-low price-to-earnings (P/E) ratio and carries a gigantic dividend yield.

If broker projections are accurate, I have a great chance of supercharging my dividend income over the next 12 months.

More accurately, a £20,000 lump sum invested equally across these stocks would give me a £1,620 passive income during the period. This is based on an average dividend yield of 8.1%.

I’m confident that these UK shares will steadily grow dividends over the long term, too. Here’s why I’d buy them for my own portfolio if I had spare cash to invest.

Cheap REIT

High interest rates are an ongoing threat to real estate stocks. They depress the net asset values (NAVs) of these companies’ property portfolios and push up borrowing costs.

But the stunning all-round value of Impact Healthcare REIT suggests now could be a great time to buy. Not only does it trade on those rock-bottom P/E ratios and carry that 8%+ dividend yield. At 85.1p per share, Impact also trades at a near-27% discount to its estimated NAV per share of 116p.

As a major care home provider, it looks in good shape to capitalise on the UK’s growing elderly population. And REIT rules mean it could be an especially good pick for future passive income.

In exchange for certain tax breaks, these shares must pay at least 90% of their annual rental profits out by way of dividends.

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.

Green dividend machine

Investing in renewable energy stocks could also deliver the holy grail of healthy capital appreciation and dividend income. Demand for clean energy is growing sharply as legislators take steps to wean their countries off fossil fuels.

I think Greencoat Renewables could be a great share to help me exploit this opportunity. The business owns onshore and offshore wind farm assets all across Europe, from which it sells power to electricity companies.

On the downside, its ability to generate power can be significantly compromised during calm weather periods.

But on the other hand, the stable nature of energy demand means its earnings aren’t affected by broader economic conditions, unlike most other UK shares. This in turn can make it a dependable dividend payer year after year.

What’s more, Greencoat’s wide geographic footprint helps reduce the threat of adverse weather patterns at group level. The bulk of its assets are in Ireland. However, its wind farms are also in France, Spain, Sweden, and Finland.

Over the long term, I think this could prove a hugely lucrative stock to own in my portfolio.

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Green machine

At 88 euro cents per share, renewable energy stock Greencoat Renewables (LSE:GRP) carries an enormous 7.7% dividend yield. Meanwhile, its price-to-earnings (P/E) ratio clocks in at just 9.9 times.

But why does it trade so cheaply? Well, high interest rates are a problem for businesses like this, and could remain so if central banks fail to deliver a stream of cuts in the coming months.

This would keep the pressure on net asset values (NAV) and, as a result, company earnings. But I believe that this threat is baked into the cheapness of Greencoat Renewables shares.

The company also trades on a forward price-to-book (P/B) value of below one, at 0.8. This indicates that it trades at a discount to the value of its assets.

I think Greencoat — which sells clean energy from its wind farms, primarily in Ireland — has significant long-term growth and income potential as the switch to renewables from fossil fuels accelerates.

10% dividend yield

I believe M&G (LSE:MNG) shares also look like a bargain at current levels of 201p. And that’s not just because its 10% forward dividend yield is one of the largest on the FTSE 100.

The financial services giant also trades on a P/E ratio of 9.6 times for this year. On top of this, its price-to-earnings growth (PEG) ratio clocks in at 0.1.

As with the P/B ratio, a sub-one reading suggests that a stock is undervalued.

Interest rate uncertainty is also a problem for M&G in the near term. As well as impacting its assets under management, a higher-than-normal rate environment also saps the amount consumers spend on financial services.

However, I believe the long-term benefits of owning M&G shares still make them an attractive investment. I’m confident its sales will rise strongly as the average population age increases, and concerns over pensioner benefits steadily intensify.

Bouncing back

ITV‘s (LSE:ITV) share price has gone gangbusters in 2024. And yet, at 78.7p per share, investors can still enjoy exceptional value with it today.

The FTSE 250 company trades on a forward P/E ratio of 8.8 times. It also offers up a 6.3% dividend yield.

As with any commercial broadcaster, profits at ITV are highly sensitive to conditions in the broader advertising market. Although improving of late, things may remain tough if interest rates fail to budge and the UK economy remains weak.

Yet there’s still a lot I like about the business from an investment perspective. Its ITV Studios division continues to deliver the goods, and is set to deliver average organic revenue growth of 5% between 2021 and 2026.

The firm’s ITVX streaming division also continues to perform robustly, with total viewer hours rising 16% in quarter one to 449m hours. There are risks here, but on balance I think it’s a great passive income stock to consider.

The post 3 of the best-value passive income shares to consider today! appeared first on The Motley Fool UK.

Here are three cut-price UK shares I’ll be aiming to buy at the next opportunity.

Ramsdens Holdings

Many British stocks face considerable uncertainty in 2024 as the domestic economy sags. Shock news that UK GDP shrank 0.3% in October suggests that a potential recession is coming down the tracks.

However, pawnbrokers like Ramsdens Holdings (LSE:RFX) perform strongly in such an environment. Indeed, this company printed record profits of above £10m during the 12 months to September as the cost-of-living crisis endured (exact full-year numbers are due to be confirmed in mid-January).

Ongoing expansion gives Ramsdens extra opportunity to grow earnings as well. It opened eight new stores in fiscal 2023 to take the total to 161. It has also invested heavily in its online channel to capitalise on the e-commerce boom.

Today the firm trades on a low P/E ratio of 8.7 times for 2024. It also carries a chunky 5.2% dividend yield.

The company faces severe competition from money lenders. But I believe this is priced into Ramsden’s valuation.

Primary Health Properties

Real estate investment trusts (REITs) have been struck by high interest rates more recently. Persistent inflationary pressures may mean interest rates stay higher for longer too, keeping net asset values (NAVs) of these stocks under pressure.

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.

Yet I still think Primary Health Properties (LSE:PHP) is an attractive value stock for the New Year. Moderating inflation, and the poor state of Britain’s economy, mean that rates are likely to come down. Besides, this UK property stock has excellent defensive qualities that make it a top pick in these uncertain times.

As its name implies, the FTSE 250 firm specialises in the rock-solid healthcare sector. Furthermore, the rents it receives are derived from government bodies. Finally, the company has its tenants tied down on long-term contracts (its weighted average unexpired lease term (WAULT) stood at 10.6 years as of June).

This all explains why analysts expect PHP’s long record of annual earnings growth to continue next year. So the company trades on an undemanding P/E ratio of 14 times. A large 7% dividend yield provides an added sweetener.

Greencoat Renewables

Investing in renewable energy stocks could be another good idea to build wealth next year. Not only is demand for cleaner power sources steadily growing. The stable nature of electricity demand makes these companies lifeboats in troubled times like these.

Greencoat Renewables (LSE:GRP) is one such stock on my radar. Today it trades on a P/E ratio of just 11.4 times for next year. It also packs a huge 6.9% dividend yield.

Purchasing green energy shares comes with acceptance that earnings may drop during periods of adverse weather. During cloudy and calm conditions power generation can drop off a cliff.

But Greencoat’s wide geographic wingspan helps to reduce this risk. The wind and solar farms it owns are spread across Ireland and mainland Europe.

I think this UK share could be a great long-term buy as the fight against climate change heats up.

The post 3 breathtaking bargain stocks I’m hoping to buy in 2024! appeared first on The Motley Fool UK.