In light of the ongoing uncertainties in the Nigerian market, one viable strategy to explore is the investment in dividend-paying stocks.
These stocks provide investors with a dependable means of generating passive income amidst market fluctuations.
Whether one approaches this as a short-term “dividend trapper” looking to benefit from rapid payouts or as a long-term income investor in search of consistent returns, high-yield stocks merit serious consideration.
UBA
United Bank for Africa (UBA) is providing an attractive dividend yield of 15.97%, calculated from its share price of N31.30 as of April 14, 2025.
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The bank announced a final dividend of N3.00 in addition to the N2.00 interim dividend, resulting in a total of N5.00 per share for the year 2024. This reflects a payout ratio of 26.6%, as detailed in the notes accompanying the 2024 financial statements.
The concluding dividend is scheduled for distribution on April 26, 2025, to shareholders who are registered by April 11.
Over the last four years, UBA has distributed more than N185 billion in dividends, demonstrating a reliable commitment to rewarding its investors. Nevertheless, despite robust earnings, the share price has experienced a decline of 7.9% year-to-date, which contributes to the elevated yield.
Nonetheless, the stock continues to be actively traded in the market, with a total traded value of N41.5 billion and 1.13 billion shares exchanged in the past three months, providing investors with both liquidity and the potential for income.
GTCO
GTCO is an attractive option for investors seeking reliable income. For the year 2024, it has declared a total dividend of N8.03 per share, representing a remarkable increase of 151% compared to the previous year, thus providing substantial cash returns alongside impressive profits exceeding N1 trillion.
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Throughout the past five years, the company has maintained a consistent dividend payout while achieving an average annual growth rate of 27%, demonstrating its dedication to rewarding its shareholders.
GTCO provides a dependable combination of substantial dividend income, growth potential, and liquidity, positioning it as an excellent option for investors prioritising income.
Fidelity
Fidelity Bank is steadily gaining popularity among investors who prioritize dividends, boasting an impressive dividend yield of 11.06%.
In 2024, the bank will distribute N2.10 per share, which includes a final dividend of N1.25 and an interim dividend of N0.85, reflecting a remarkable 231% increase in total payouts.
The bank is set to return more than N89 billion to its shareholders from a post-tax profit of N278 billion, resulting in a payout ratio of 33%.
Currently trading at N18.20, down slightly from N19.40, the yield remains attractive. However, if the share price continues to rally, the dividend yield will naturally decline, but investors could benefit from capital appreciation instead.
Zenith
enith Bank has announced a total dividend of N5.00 per share for the 2024 financial year, which includes a final dividend of N4.00 and an interim dividend of N1.00 that has already been disbursed.
This results in a total cash distribution to shareholders amounting to N195.68 billion, corresponding to a 10% dividend yield based on the closing price as of April 14, 2025. The final dividend is scheduled for payment on April 29, 2025.
Despite achieving a substantial post-tax profit of N1.03 trillion, the bank is allocating only 18.94% of its earnings for distribution, indicating a relatively low payout ratio.
This situation presents opportunities for future growth, and with its strong earnings and significant retained profits, many investors are likely to anticipate increased payouts in the years ahead.
Zenith’s stock has also appreciated by 9.89% year-to-date, reflecting a positive sentiment among investors.
