The dividend yield is 6.3%! Here are 2 stocks you can consider buying for income
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If you’re looking for stocks to buy, many 9%+ producers will often catch your eye. But like one of those all-you-can-eat buffets, it’s often too good to be true. In other words, they are traps.
However, the following dividend stocks look strong to me. In addition, they do not carry a yield of 1%-2%. paid a dividend of 6.3 %.
FTSE 100
Original stock Aviva (LSE:AV.) from FTSE 100. With over 25 million customers in the UK, Ireland and Canada, insurance almost needs no introduction. More than 7m UK customers hold two or more policies with Aviva.
As we can see, the price has done well, almost doubling in five years. However, the annual dividend yield remains at 6.3%.
Following its £3.7bn acquisition by rival Direct Line, it is now the UK’s largest car and home insurer. And between 2025 and 2028, management expects a compound annual growth rate of 11% in operating earnings per share.
Needless to say, this bodes well for the profit potential, as the market expects a rise of almost 7% in FY26 earnings. Share buybacks are also slated to resume this year, which could support the share price.
One inescapable fact here is that the insurance market is competitive, while the recession wouldn’t have helped anyone, including Aviva.
But with the stock trading at 11 times earnings, and dividend prospects looking strong, I think Aviva is worth checking out.
FTSE 250
Next, we have TBC Bank (LSE:TBCG) from FTSE 250. This one is probably not well known, as it is one of the two largest banks in Georgia. That is a country in the Caucasus, between Europe and Asia, not a US country.
This geography helps explain why the stock is up nearly 250% in five years. As trade routes through Russia became restricted after the war, Georgia emerged as an important trading post connecting China with Central Asia and Europe.
It has also benefited from skilled migrants arriving from Russia, as well as the development of tourists. TBC also has a strong presence in Uzbekistan, another fast-growing economy that enjoys GDP growth of 7.7% by 2025.
This helped the lender grow revenue by 17% in Q3, and monthly active customers by 14% to 7.46m. Meanwhile, the bank’s return on equity remains in the mid-20s, above the industry average for European and emerging banks.
The biggest risk I see is the growing political tensions, leading to less tourism income in early 2025. If this flares up again, it could hurt investment in the country, leading to a decline in lending activities.
As things stand, the bank seems well-positioned for continued growth. Tourism has been making a comeback, helping Georgia’s economy grow by 7.5% last year. The UN projects growth of 5.4% by 2026, up to 6% in Uzbekistan.
The stock trades very cheaply at 5.5 times forward earnings, while boasting a forecast yield of 6.3%. The payout is covered about three times by the expected profit, which provides a significant margin of safety.
With TBC stock down 13% since July, I think this is a dip buying opportunity that we should capitalize on for income.
