It’s clear that 2021 has been a good year for investors relying on share dividends. FTSE 100 companies returned £82 billion in dividend payouts this year. That’s up a massive 32% from 2020.
And if you hold FTSE 100 shares, one investment platform forecasts 2022 will be another good year for investors.
So, which companies are set to deliver big dividends in 2022? Let’s take a look.
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What is a share dividend?
A share dividend is a portion of profits paid to investors in a particular company. Dividends can be issued to investors in cash or additional shares.
Investors who look to invest in companies with healthy share dividend payouts, as opposed to focusing solely on share price, are typically known as ‘income investors’.
Which companies are forecast to offer big dividends in 2022?
According to analysts at AJ Bell, these five companies will witness the biggest share dividend growth in 2022.
1. London Stock Exchange Group
According to AJ Bell, investors holding shares in the London Stock Exchange Group will enjoy the biggest share dividend growth in 2022. Its forecast suggests the group will see its dividend yield grow by 15.7% next year. Its current dividend yield is already a healthy 1.11%.
2. Intermediate Capital
Intermediate Capital is also expected to see a big growth in its share dividend payout in 2022. The asset management firm is forecast to see its dividend grow by 14.3% next year, adding to its current 2.65% investment yield.
3. Ashtead
Ashtead is expected to witness hefty share dividend growth next year. The British industrial equipment firm is set to see its dividend grow by 12.5%.
Ashtead’s current dividend yield is just 0.77%. However, current investors are unlikely to have been disappointed by the firm’s performance in 2021. That’s because the company’s share price has risen by a colossal 68% since the turn of the year.
4. Dechra Pharmaceuticals
The company expected to deliver the fourth biggest share dividend growth in 2022 is Dechra Pharmaceuticals. The company is involved in the development and marketing of veterinary products and, according to AJ Bell, will see its dividend grow by 10.6% next year. Dechra’s current yield is 0.82%
5. Halma Plc
Halma plc is a British safety equipment company. AJ Bell suggests its investors will enjoy a 10.5% dividend growth in 2022. The company currently pays a dividend yield of 0.58%.
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Which other FTSE 100 companies will offer high dividends in 2022?
AJ Bell predicts these companies will also deliver hefty dividend returns next year.
| FTSE 100 company | Industry | Current dividend yield | Forecast growth in 2022 |
| Relx | Publishing | 2.02% | 8.2% |
| Spirax-Sarco | Manufacturing | 0.79% | 6% |
| DCC | Sales & Marketing | 2.74% | 5.8% |
| Croda International | Chemicals | 0.94% | 5.7% |
| British American Tobacco | Tobacco | 8.06% | 5.5% |
| Scottish Mortgage IT | Investment Trust | 0.25% | 4.2% |
Aside from the performances of individual companies, AJ Bell suggests that FTSE 100 members will return a combined total of £84 billion in share dividends next year. This is £2 billion higher than dividends paid to investors in 2021.
What can investors take from these predictions?
While some investors may wish to take note of AJ Bell’s forecasts, accurately predicting dividend yields is a tough ask. In fact, making any sort of investing predictions is extremely difficult.
That being said, it’s fair to say that the performance of individual members of the FTSE 100 will be heavily dependent on the performance of the UK economy next year. Covid-19 will undoubtedly be a factor to consider, as many investors will hope 2022 will be the year when the world finally begins to move on from the pandemic.
Russ Mould, investment director at AJ Bell, explains how dividends will be impacted by the economy in 2022. He says “A renewed drop in economic activity – for whatever reason – could still pose a big risk to dividends.
“Equally, an unexpectedly strong economic recovery, and one that sparks higher commodity prices as inflation takes grip, could leave oil and mining companies, and by extension the FTSE 100, in dividend clover – great news for income investors.”
Are you new to investing? If you’re keen to learn more about investing, take a look at The Motley Fool’s investing basics. If you’re looking to invest, see our list of top-rated share dealing accounts.
