2 of the biggest stocks (including the newbie FTSE 100) to consider in October!
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I am looking for good stocks to buy this month for a winning income. Of course, I don't just want high-yielding equity stocks right now. Instead, I look for businesses that are in a good position to maximize shareholder payouts over time.
The following dividend stocks would give me the best of both worlds, I believe.
| Stock | 2024 dividends per share | Dividend yield | 2025 dividends per share | Dividend yield |
|---|---|---|---|---|
| Tritax Big Box REIT (LSE:BBOX) | 7.64p | 4.7% | 8.09p | 5% |
| Basic Health Structures (LSE:PHP) | 6.9p | 6.8% | 7p | 6.9% |
That's why I think it's worth taking a closer look this October.
Tritax Big Box REIT
Tritax's merger with UK Commercial Property REIT in May opened the door for a promotion FTSE 100. It also enters the index as one of its largest dividend payers. As the table above shows, dividend yields rise by an average of 3.5% in the broader Footsie over the next two years.
Real estate investment trusts (REITs) like these can be good options for income investors. This is because they are obliged – in order to receive tax benefits – to pay at least 90% of their annual rental income in the form of benefits.
That's because they also tend to have tenants locked into long-term contracts, giving them valuable capital (not to mention confidence) to pay a large and often growing dividend over time.
At Tritax, the average unexpired lease term (WAULT) for its fixed assets was 14 years as of June.
This bodes well for future payments, as does your position in a fast-growing market. The demand for modern specialized logistics hubs should grow steadily as commerce rates increase, supply chains are improved, and companies invest to improve their ESG credentials.
Higher-than-normal interest rates have put commodity stocks like Tritax Big Box under pressure recently. This remains a threat going forward. But falling inflation means the Bank of England looks set for more rate cuts, providing a sector-wide boost.
Please note that tax treatment depends on the individual circumstances of each client and may change in the future. The content of this article is provided for informational purposes only. It is not intended to be, and does not constitute, any form of tax advice.
Basic Health Structures
Like Tritax Big Box, Primary Health Properties is classified as a REIT, offering investors the same dividend benefits. But over the next two years at least its dividend yield is impressive approaching 7%.
Moreover, its equity growth track record is better. Shareholder payouts have increased every year since 2009.
Like its industry peers, it has its tenants signed long-term contracts. Its WAULT is sitting at 9.8 years as of June.
Primary Health also has an ace up its sleeve making it a reliable dividend payer. The company's focus on healthcare properties (such as GP surgeries) means rents are guaranteed by local authorities and the NHS.
Like Tritax, the future direction of interest rates creates uncertainty here. Earnings may come under pressure if healthcare policy changes in the UK. However, in comparison, I think Primary Health Properties is a decent income share.
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