10 income shares to buy instead of Royal Mail

Published by Esther Armstrong on 15 October 2013.
Last updated on 21 October 2013


Many investors have been left disappointed by the paltry allocation of Royal Mail shares they received, and in some cases were left with none at all.

Aside from whatever growth potential Royal Mail may or may not have - quite a bit says broker Canaccord Genuity, which has slapped a 599p target on the shares - the company's commitment to providing a decent dividend was the rationale behind a lot of investors' interest.

If those who received the £750 worth of shares hold on to them they are set to be rewarded with a yield of 6.1%, as reported previously.

But if they were hoping to put a larger chunk of money in to benefit from such a healthy income, they will now be faced with a conundrum of what to do with that cash.

Private client broker Killik & Co has put together a list of its top UK income ideas for investors looking for a decent dividend yield, available below.

BHP BILLITON 1,772 10.3 4.3 7% CAGR* over the next three years
CENTRICA 361 12.2 4.7 Growing in real terms
ESURE GROUP 223 9.5 6.2 5% CAGR over the next three years
GLAXOSMITHKLINE 1,550 12.1 5 Growing in real terms
HSBC HOLDINGS 669 10.3 4.8 11% CAGR over the next three years
NATIONAL GRID 744 13.6 5.7 At least in line with inflation
ROYAL DUTCH SHELL 2,078 7.8 5.4 Ahead of the rate of inflation
UNILEVER 2,351 16.3 3.8 Growing at a double-digit rate
UNITED UTILITIES 689 15.7 5.2 Growing at RPI+2% to 2015
VODAFONE 215 14.5 4.8 Growing in real terms

* Compound Annual Growth Rate

Leave a comment