Dividend yield scan: 5 high yield stocks set to grow dividends in FY24

The dividend yield scan identifies ASX 300 companies that currently have a trailing yield of over 8% as well as those expected to increase dividends in FY24.

There are currently 21 companies with a trailing dividend yield of more than 8%. The data does not include listed investment funds and trusts.

• Top sectors include Financials (6) and Energy (4)

• The average 1-year share price performance is -15.8%

• The median 1-year share price performance is -18.4%

• The performance has been weighed by names like APM Human Services (-66%), Abacus Group (-62%), IGO (-52%) and Platinum Asset Management (-51%)

The Highest Dividend Yields

The below data is sorted from highest to lowest yield.

Data as at Tuesday, 12 February 2024 (Source: Refinitiv)

5 Stocks to Grow Dividends

There are five stocks forecast to grow their dividend payouts in FY24. This includes:

• Yancoal

• Myer

• Helia Group

• Incitec Pivot

• Insignia Financial

We'll take a closer look at Incitec Pivot this week. You can check out the commentary for the other four stocks here.

Incitec shares are down 24% in the past twelve months and down around 9% since December 2023. The company announced a mixed update at its AGM on 21 December. Here are some of the key takeaways:

• Incitec faces prolonged negotiations for the sale of its fertiliser division to state-owned Indonesian group Pupuk Kaltim. Nonetheless, analysts expressed confidence in the company's ability to successfully execute large-scale asset sales, as demonstrated by the completion of the WALA sale.

• The delay in the fertiliser business sale has pushed back substantial capital returns to shareholders including a $500 million on-market buyback and $500 million in capital returns (by way of capital reduction and special dividend)

• The outlook for IPL's explosives business remains positive supported by the Australian ammonium nitrate pricing and successful repricing contracts, indicating a potential return to peak earnings in FY24

Putting it all together – Incitec Pivot is expected to maintain its dividend despite cycling very strong commodity prices from FY22. Analysts expect the fertiliser business sale to progress, which should deliver a one off capital return to shareholders. Despite the sound outlook for FY24, the company's dividend is forecast to fall from FY25. All-in-all, the dividend yield might be sustainable in FY24 and propped up by one-off distributions but expected to fall over the medium term.