13,500 shares of this rebounding FTSE 250 stock could unlock £2,000 a year in passive income
Faced with inflationary pressures, tariff concerns and slowing growth across global markets, the FTSE 250 has still held its ground better than many expected. Whatâs more, the index hosts a wide range of dividend-payers, several with yields higher than some of the FTSE 100âs most reliable stocks.
Of course, yields alone donât tell the full story. Mid-cap shares can be more volatile, so I think itâs critical to examine the financials before drawing any conclusions.
One recovering stock Iâve been looking at recently is Aberdeen Group (LSE: ABDN). It has an 8% yield and the shares are currently trading around 185p. That means 13,500 of them would be worth £25,000, generating over £2,000 a year in passive income.
Thatâs certainly worth running the numbers.
Taking a closer look
Aberdeen is a global investment firm offering asset management and savings solutions. The company has had a rough few years, not helped by confusing branding decisions following its merger with (and subsequent sale of) Standard Life.Â
As a result, its shares are still down 22% over the past five years.
Yet 2025 has been a far better story. Year-to-date, the share price has climbed around 30% â meanwhile, the dividend yield hasnât been pushed down too far. Payments appear fairly sustainable too, with a payout ratio of 82% and an uninterrupted track record of 19 years.
That kind of consistency is rare among FTSE 250 names, adding to why I think the stock is one investors may want to consider.
Profitability, however, still has some way to go to recover. Return on equity (ROE) is fairly low at 6.5% while the operating margin is around 30%. Thatâs respectable, but comparatively weak for an investment manager.Â
A possible reason for this may be the growing shift from actively managed funds to low-cost passive products. With Aberdeen still heavily reliant on traditional fund management, this trend presents a notable challenge.
Client concentration is another risk — earlier this year a single mandate loss from Phoenix Group led to billions in outflows. Over-reliance on large clients could easily hurt earnings if more contracts are pulled.
Still, the balance sheet looks healthy, with £11.57bn in assets and a debt-to-equity ratio of just 0.11. This low leverage adds a decent level of financial protection if markets turn rough.
Recovery potential
Despite the risks, Aberdeen has been trying to reset its narrative. Its 2022 purchase of Interactive Investor helped it expand into new markets â while the more recent sale of its financial planning arm helped it refocus on core services.
These moves could lay the groundwork for more stable long-term growth.
The question is whether the business can adapt quickly enough. If margins continue to be squeezed and more clients opt for passive alternatives, profitability may struggle to improve. And if earnings fall too far, even a long track record of paying dividends may not protect investors from a cut.
For now, I think it remains one of the more reliable high-yielding stocks on the FTSE 250. While the risks around fund flows and profitability are evident, the high yield and solid track record still look mighty attractive.
When included as part of a well-diversified portfolio, it could help provide financial sector exposure while also boosting the overall yield.
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Mark Hartley has positions in Phoenix Group Plc. The Motley Fool UK has no position in any of the shares mentioned. 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.
