Top 5 stocks for dividends

By investing in publicly traded dividend companies, you can receive shares of their profits. Read this article to find out more.

At the end of each fiscal year, publicly traded companies pay out portions of their profits, known as dividends, to their shareholders. 

What are dividends ?

Dividends are financial benefits exclusive to stocks that allow traders to enjoy additional and regular income. The size of the dividend depends on the amount of shares held. The amount allocated to a shareholder also depends on the total profits made by the company. The company's dividend policy is also a determining factor in their distribution. Generally, the general meeting of shareholders determines the share of the profits paid to each investor.

Dividends, also known as coupons, usually come with the right to participate in the governance of listed companies. This is particularly true when important decisions are made. However, when the holding of shares is limited to the collection of dividends, the amounts paid out to shareholders are often higher.

Investing in the right companies for high dividends

In order to benefit from high dividends, you need to invest in the most reliable and best performing companies… But you already knew that. Your choice should be based on the company's financial health, its history, its forecasts and its development factors. You should also take an interest in its sectors of activity, location and macro-economic situation.

Below is a list of 5 publicly traded companies that have been the best performers for several years. All these companies have a market capitalization of more than € 1 billion. Note that this ranking is based on the average calculation of returns over a period of 5 years.

Calculating of the annual profit of a company

The annual yield of a company is obtained by dividing its annual dividend by its share price. 

Example: let's say a share price of €25 with an annual dividend of €1.20 per share. The yield is therefore €1.20/€25, i.e. €4.80

This means that when the stock price falls, the return increases. In the opposite case, the company's return decreases if its share price increases. It is therefore necessary to adjust the return according to the evolution of the share price.

5 companies that paid top dividends over the last 5 years

Note that this classification excludes extraordinary dividends. It is limited solely to profit shares paid out in the context of traditional business activities. 

In addition, some of the downward trends in dividend payouts are a natural consequence of the covid-19 crisis. Many companies have suspended, reduced or even cancelled their dividend payments for 2020 and 2021. For this reason, our list is based on the size of the dividends paid over the last 5 years. 

The companies presented here have paid an average dividend ranging from 5.39% to 11.20% over the 5-year period considered. These companies are listed on the CAC 40, which includes the 40 largest companies listed on the Paris stock exchange.

EUTELSAT COMMUNICATIONS : Satellite operator for TV and radio broadcasting 

Eutelsat Communications is a company specialized in satellite transmission services. Its main customers are providers of video, data and telephone communications.

Eutelsat's current share price is €9.95. Over 5 years, the company has accumulated a return of 55.98%. This gives it an average annual return of 11.20%. 

The dividend yield increased during the period from 2017 to 2019. The share of profits returned to shareholders increased from €1.21 to €1.27. However, the economic crisis caused by the coronavirus pandemic caused the dividend to decrease to €0.80 in 2020. 

Eutelsat's next dividend payment is scheduled for November 2021. It is showing a slight upward trend, rising to €0.93.

Given the current share price of € 9.95 and dividend of € 0.93, the company's yield for this year is therefore 9.35%. This reflects a good performance. 

CARMILA : shopping center real estate company

Carmila specializes in real estate and owns a large number of retail facilities, including those of Carrefour and other subsidiary companies. In all, the group manages 214 shopping centers in France, Italy and Spain. Currently, its real estate assets are worth €6.13 billion.

The current share price of this company is €11.86. Its cumulative dividend yield over these 5 years (from 2017 to 2021) is 51.69%. This gives an annual average of 10.34%. 

During the reporting period, the dividend of this company varied between €1.88 in 2017 and €0.75 in 2017. It should be noted that an additional exceptional dividend of €0.75 was paid in 2017. Thus, for 2017, a total of €2.63 was paid out for the year. 

For 2020 and 2021, the Carmila Group's share of the dividend has been maintained at €1 for each share held.

For the year 2021, the group's return is significant and stands at 8.43%. This percentage is due in particular to the current value of its share, which is 11.86%. But also the dividend of €1 initially planned. 

SES : Satellite communication service provider

SES is one of the world's leading satellite communications operators, operating in several orbits. SES is the leading provider of HD video streaming services worldwide.

The share price of the SES Group is € 7.30. Over the last 5 years, this company has accumulated a dividend yield of 51.23%. That is an annual average of 10.25%. 

Over the period studied, the SES dividend shows a downward trend. Indeed, it amounts to €1.34 in 2017 and drops to €0.40 in 2021. This situation can be explained in particular by the impact of economic contexts on investor sentiment. 

However, the return on the SES share is still advantageous, as it stands at 5.48%. This result takes into account the current share price of € 7.30. But also the dividend of € 0.40 that was paid for its last fiscal year.

UNIBAIL RODAMCA WESTFIELD: a global commercial real estate group

Unibail Rodamco Westfield is the world's leading retail property company with a portfolio valued at €56 billion. A figure that will be released at the end of 2020.

Unibail's current share price is €70.14. This group has a cumulative dividend yield of 45.34% for the last 5 years. This indicates an average annual yield of 9.07%. 

The group shows a slightly upward-trending dividend between 2016 and 2019. The share paid to shareholders increased from €9.70 to €10.80 during this period. 

Due to the covid-19 crisis, the dividend payments for the year 2020 and 2021 are cancelled. The impacts of the pandemic have greatly affected this sector. Some predictions suggest that the next dividend payment for this group will be in 2023.

MERCIALYS : Leader in retail in the land sector

A major real estate group, Mercialys owns mainly assets comprising shopping centers. The company's real estate portfolio reached €3.19 billion in the second quarter of 2021.

The share price of this company is currently € 9.61. The company has accumulated a total dividend yield of 43.91% over 5 years. This represents an average annual yield of 8.78%. 

The level of Mercialys' dividend was stable in 2017 and 2019. The shareholders' share varied between €1.04 and €1.18. 

In the period of 2020 and 2021, the Covid-19 crisis caused a strong decrease. The dividend was reduced to € 0.48 and € 0.43 respectively. 

For the year 2021, the group continues to enjoy a good yield of 4.47%. This calculation is based on the current share price of €9.61 and the last dividend payment of €0.43.

How do you find the best dividend stocks?

There are certain criteria to consider when selecting the best dividend companies.

Choosing a dividend-paying company based on your investment strategy

Investors can choose from three strategies to expect dividend growth from publicly traded companies. 

  • The value strategy : this is based on selecting an underpriced stock in order to be able to capture a capital gain when the price rises. This requires taking into account the financial health of the company
  • Growth strategy : this is used by investors to speculate on the continued growth of the stock price. This allows companies to grow better over time
  • The yield strategy : this method is based on the search for the best dividend stocks.

Select companies belonging listed on the CAC 40

Every year, CAC 40 companies pay increasing dividends to their shareholders. This is mainly the result of investors' confidence in the performance of these large companies and investing in them. This allows those companies to develop their activities and make more profits. 

With this in mind, it is only natural that their share prices continue to rise and attract more investors. Thanks to the overall value gain of these groups, dividends are also bound to increase to reward shareholders for their trust.

Research broker websites

You can also ask for advice from your banker, who keeps an up-to-date list of the best dividend companies. Furthermore, on Boursorama, you can also carry out a descending sorting of the yields to identify the strongest ones. 

Note that the most reliable and profitable dividend payouts are definitely included in the Dividend Aristocrats. These are linked to companies that are known for their ability to pay strong dividends for 25 years. You can also invest in the Dividend Kings, which have the best dividend yields over a 50-year period.