Here are some of my top FTSE 100 dividend stocks to consider buying in 2025

I’ve been looking at the outlook for dividend stocks in 2025, and it has to depend a fair bit on how total 2024 dividends turn out. And that picture looks a bit mixed.

According to the most recent Dividend Dashboard from AJ Bell, analysts expect a total of £78.5bn in FTSE 100 dividends for 2024. And that should be backed by total pre-tax profit for the index coming close to beating the all-time record set in 2022.

But against that, forecasts suggest almost no dividend gain over 2023. And cover by earnings looks likely to drop. There are some big dividend yields on the cards. But there must be fears they could come under pressure.

Optimism ahead

At least the City expects dividends and cover to both rise in 2025, but I’m wary of such an early prognosis. Every year for the past few years, these surveys have shown optimism at the start. But estimates keep being scaled back as each year progresses.

I can’t help thinking our dividend focus could do well to shift towards a bit more safety this year. We need to keep an eye on those earnings. So which dividend stocks do I think we should consider as potentially safer buys in 2025?

I’m leaning towards HSBC Holdings (LSE: HSBA) for one, even though its share price has gained close to 50% in the past five years.

Covered high yield

Despite the rise, we’re still looking at an estimated dividend yield of 5.8% for the year ended December. And, importantly if we think payout pressure might emerge in 2025, forecasts put cover by earnings at 2.1 times.

The bank’s exposure to China looks like the biggest risk, with its economy struggling to grow. And who knows what any international trade war may bring?

But in a Q3 update, CEO Georges Elhedery announced “a further $4.8bn of distributions in respect of the third quarter, which bring the total distributions announced so far in 2024 to $18.4bn.“

We’re looking at a forward price-to-earnings (P/E) ratio of only eight. And forecasts suggest dividend growth in the years ahead.

Real estate investor

Looking for other 2024 final dividends expected to be strongly supported, I see Land Securities with predicted cover of 1.7 times. It’s a real estate investment trust (REIT) that operates offices, shopping centres, and retail parks

Weak property sentiment might hold the share price back until we see the next bull market. And we might need the economy to brighten. But the expected 6.9% dividend puts it firmly on my consideration list.

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Dependable yield

The British American Tobacco dividend has been one of the FTSE 100’s more reliable ones. It hasn’t been cut in the past decade while so many others have fallen around it.

Regulatory challenges combined with uncertainty over the long-term future for tobacco are the main fears. But I can see the stuff being consumed in one form or another long into the future. And a 7.4% dividend, covered 1.6 times by forecast earnings, has to make this a serious consideration too.

The post Here are some of my top FTSE 100 dividend stocks to consider buying in 2025 appeared first on The Motley Fool UK.

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Alan Oscroft has no position in any of the shares mentioned. The Motley Fool UK has recommended Aj Bell Plc, British American Tobacco P.l.c., HSBC Holdings, and Land Securities Group Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.