Top UK Dividend Stocks To Consider In July 2025

As the UK market navigates through challenging global cues, particularly from China's faltering trade data, investors are closely watching the FTSE indices which have recently experienced declines. In such uncertain times, dividend stocks can offer a measure of stability and income potential, making them an attractive consideration for those looking to mitigate market volatility while seeking steady returns.

Top 10 Dividend Stocks In The United Kingdom

Click here to see the full list of 59 stocks from our Top UK Dividend Stocks screener.

Let's explore several standout options from the results in the screener.

Arbuthnot Banking Group (AIM:ARBB)

Simply Wall St Dividend Rating: ★★★★☆☆

Overview: Arbuthnot Banking Group PLC, along with its subsidiaries, offers private and commercial banking products and services in the United Kingdom, with a market cap of £153.99 million.

Operations: Arbuthnot Banking Group PLC generates revenue through several segments, including Banking (Excl. Wealth Management) at £95.64 million, Arbuthnot Commercial Asset Based Lending (ACABL) at £19.93 million, ALL Other Divisions at £18.67 million, Asset Alliance Group (AAG) at £15.34 million, Renaissance Asset Finance (RAF) at £12.56 million, and Wealth Management contributing £13.67 million in the United Kingdom market.

Dividend Yield: 5.2%

Arbuthnot Banking Group offers a mixed dividend profile, with dividends well-covered by earnings due to a low payout ratio of 32.2%. Despite this, the dividend yield of 5.19% is below the top tier in the UK market and has been volatile over the past decade. The company faces challenges with a high level of bad loans at 3.4%, and recent board changes may impact future strategic direction.

• Click here and access our complete dividend analysis report to understand the dynamics of Arbuthnot Banking Group.
• Insights from our recent valuation report point to the potential undervaluation of Arbuthnot Banking Group shares in the market.

Grafton Group (LSE:GFTU)

Simply Wall St Dividend Rating: ★★★★★☆

Overview: Grafton Group plc is a distributor and seller of building materials and construction-related products across Ireland, the United Kingdom, the Netherlands, Finland, and Spain, with a market cap of £1.91 billion.

Operations: Grafton Group plc generates revenue through several segments: Retailing (£261.06 million), Manufacturing (£122.16 million), UK Distribution (£780.78 million), Spain Distribution (£29.66 million), Finland Distribution (£131.76 million), Ireland Distribution (£632.81 million), and Netherlands Distribution (£337.58 million).

Dividend Yield: 3.8%

Grafton Group's dividend profile is supported by a sustainable payout ratio of 60.8% and strong cash flow coverage at 35.9%. The company has consistently increased dividends over the past decade, although its yield of 3.77% is below the top UK payers. Recent board appointments, including Andrea Gisle Joosen and David Dillon, may influence future governance positively. Revenue for early 2025 rose to £773.1 million, reflecting growth initiatives and acquisitions like Salvador Escoda's contribution.

• Dive into the specifics of Grafton Group here with our thorough dividend report.
• Upon reviewing our latest valuation report, Grafton Group's share price might be too pessimistic.

RS Group (LSE:RS1)

Simply Wall St Dividend Rating: ★★★★★☆

Overview: RS Group plc, with a market cap of £2.68 billion, operates in the distribution of maintenance, repair, and operations products and service solutions across the UK, US, France, Mexico, Germany, Italy, Switzerland and internationally.

Operations: RS Group plc generates revenue from its Own-Brand Product and Service Solutions, amounting to £400.40 million.

Dividend Yield: 3.9%

RS Group's dividend is stable and reliable, supported by a 69% earnings payout ratio and 50% cash flow coverage. The recent increase in dividends to 22.4 pence per share reflects consistent growth over the past decade, though the yield of 3.91% is below top UK payers. Executive changes include Carole Cran succeeding Louisa Burdett as Audit Committee Chair, potentially impacting governance positively. Despite a slight drop in annual sales to £2.9 billion, strategic client agreements may bolster future performance.

• Take a closer look at RS Group's potential here in our dividend report.
• In light of our recent valuation report, it seems possible that RS Group is trading behind its estimated value.

Seize The Opportunity

• Take a closer look at our Top UK Dividend Stocks list of 59 companies by clicking here.
• Shareholder in one or more of these companies? Ensure you're never caught off-guard by adding your portfolio in Simply Wall St for timely alerts on significant stock developments.
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Looking For Alternative Opportunities?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.
• Find companies with promising cash flow potential yet trading below their fair value.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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