Dividend progress shares could be highly effective long-term investments. These can doubtlessly generate rising revenue in addition to share price good points over time (a rising dividend payout tends to push an organization’s share price greater).

Earlier this week, I screened the UK inventory marketplace for shares with yields above 3% and 5 or extra consecutive annual dividend will increase. Listed here are three shares that caught my eye and I consider are value contemplating for an funding portfolio at present.

A significant trade

First up is defence powerhouse BAE Methods (LSE: BA.). It at the moment sports activities a dividend yield of about 3.1%. I reckon this inventory’s a sensible selection for 2025 and past. Right now, geopolitical stress is elevated globally, so governments can’t afford to disregard defence spending.

In the meantime, after a near-20% share price pullback since mid-November, the valuation appears to be like engaging proper now. Presently, the price-to-earnings (P/E) ratio utilizing the 2025 earnings forecast is simply 15, which isn’t excessive.

In fact, the chance with an organization like that is that governments (significantly the US and UK governments) can and do reign of their defence spending. This situation might result in a drop in progress (for 2025 analysts count on earnings progress of about 12% right here).

I believe this can be a good sector to contemplate for the following few years nevertheless, given the unsure geopolitical backdrop.

A quickly rising payout

One other trade I like for 2025 and past is different investments (eg, personal fairness, personal debt, infrastructure, and so forth). Right now, curiosity on this asset class is booming as many buyers want to diversify away from shares and bonds.

One UK-listed firm that operates on this house is Intermediate Capital Group (LSE: ICG). It’s an under-the-radar FTSE 100 firm that manages round $100bn on behalf of buyers.

The dividend payout right here’s grown quickly lately. For the final monetary yr (ended 31 March 2024) the corporate paid out 79p per share – up 41% on the determine three years earlier.

For the present monetary yr, analysts count on a payout of 86.3p per share. That equates to a yield of round 4.2%, which is first rate.

Now, this inventory could be unstable. As an funding firm, its share price could be influenced by developments within the monetary markets (eg, rates of interest).

Taking a long-term view although, I see fairly a little bit of potential. I believe it might even be a takeover goal.

Constant dividend progress

Lastly, try Coke bottling companion Coca Cola HBC (LSE: CCH). It at the moment yields round 3.4%.

This firm has a superb long-term dividend progress monitor report. Since paying its first dividend in 2014, it’s raised its payout each single yr.

You usually see this sort of consistency with shopper items corporations which have robust manufacturers. That’s as a result of these corporations typically have the power to place their costs up frequently, which will increase their earnings and money flows over time.

I’ll level out that geopolitical stress and battle might current some challenges for this firm within the close to time period. For instance, customers in some international locations might determine to boycott US manufacturers.

With the shares at the moment buying and selling on a P/E ratio of simply 13 nevertheless, I like the chance/reward set-up at present.