5 UK Dividend Growth Stocks to Consider

In this article, we will take a look at the 5 UK dividend growth stocks to consider. To see more such companies, go directly to 10 UK Dividend Growth Stocks to Consider.

5. The Unilever Group (NYSE:UL)

Consumer products giant The Unilever Group (NYSE:UL) is one of the top dividend growth stocks in the UK. Earlier this year The Unilever Group (NYSE:UL) upped its quarterly dividend by 8.6%.  The Unilever Group (NYSE:UL)’s dividend yield as of June 10 stands at about 4%.

As of the end of the first quarter of 2023, 18 hedge funds in Insider Monkey’s database had stakes in The Unilever Group (NYSE:UL). The biggest hedge fund stakeholder of The Unilever Group (NYSE:UL) during this period was Tom Russo’s Gardner Russo & Gardner which owns a $221 million stake in the company.

Here is what Tweedy, Browne has to say about Unilever N.V. (NYSE:UL) in its Q1 2023 investor letter:

“Portfolio activity slowed somewhat during the quarter as equity prices advanced. While there were a few new positions established, and a few sales, portfolio activity overall was quite modest compared to the rather brisk pace of the last two years. On the sell side, a number of holdings were sold or pared back, including Unilever (NYSE:UN), among others. The stock prices of these businesses had either reached our estimates of their underlying intrinsic values or had been compromised in some way by virtue of declines in our estimates of their underlying intrinsic values and future growth prospects. Or, they may have been sold or trimmed to make room for new additions, or to generate losses, which could be used to offset realized gains.”

4. Diageo plc (NYSE:DEO)

Beverage company Diageo plc (NYSE:DEO) is a dividend aristocrat with over 25 years of consistent dividend increases under its belt. Perhaps its dividend history and growth prospects were the reasons why the Oracle of Omaha snapped up a $41 million stake in Diageo plc (NYSE:DEO) during the first quarter.

 In January this year, Diageo plc (NYSE:DEO)’s management talked about its dividend growth plan:

“We’ll also be disciplined on the other side from a divestiture portfolio as we have been dividend, we will continue to be a progressive dividend payer, and we’ve announced a 5% dividend increase in this first half of this year. And then return of capital, we’ve announced an additional GBP500 million of return of capital for this year, and we will come back at year-end results with a further update for next fiscal if the Board decides to do so.”

As of the end of the first quarter of 2023, 23 hedge funds tracked by Insider Monkey reported owning stakes in Diageo plc (NYSE:DEO).

3. CRH plc (NYSE:CRH)

Ireland-based CRH plc (NYSE:CRH) is a building materials company. CRH plc (NYSE:CRH) trades on the London Stock Exchange but recently its shareholders approved the board’s recommendation to initiate a primary listing on the NYSE. CRH plc (NYSE:CRH) will retain a standard listing on the London Stock Exchange (LSE).

Over the past few years, CRH plc (NYSE:CRH) has consistently increased its dividend payouts.

As of the end of the first quarter of 2023, 13 hedge funds tracked by Insider Monkey had stakes in CRH plc (NYSE:CRH). The biggest stakeholder of CRH plc (NYSE:CRH) during this period was Edgar Wachenheim’s Greenhaven Associates which owns an $87.4 million stake in the company.

Here is what L1 Capital International Fund has to say about CRH plc (NYSE:CRH) in its Q3 2022 investor letter:

“During the December 2022 Quarter over 50% of the Fund’s holdings’ share prices increased by more than 10% in local currency with a number of them increasing by more than 20%. Five companies positively contributed over 0.5% (in AUD) to the Fund’s returns for the quarter which includes CRH plc (NYSE:CRH).

The share price of our building materials companies, CRH and Eagle Materials, also recovered from oversold levels in the December 2022 quarter, increasing 23% and 24% respectively (in USD), with further increases in early 2023. Mastercard’s share price also increased over 20% in the December 2022 Quarter.

During the December 2022 Quarter we took advantage of a strong recovery in share prices to further reduce our exposure to the U.S. housing market. We remain confident in the longer-term outlook for the building products companies we have invested in. That said, the rapid and substantial increase in mortgage rates will inevitably have a meaningfully negative impact on U.S. housing activity. Commercial activity remains robust and Infrastructure activity is expected to strengthen off a high base in 2023. We have therefore been selective in which sector investments we have retained, divesting Louisiana Pacific while continuing our investments in Eagle Materials and CRH.”

2. DCC plc (LSE:DCC.L)

DCC plc (LSE:DCC.L) is a sales and marketing company based in Ireland. DCC plc (LSE:DCC.L) operates in healthcare and energy markets. DCC plc (LSE:DCC.L) is trading on the London Stock Exchange. DCC plc (LSE:DCC.L) has upped its dividend consistently for 29 years in a row.

1. Croda International Plc (LSE:CRDA.L)

UK-based chemical company Croda International Plc (LSE:CRDA.L) is one of the best UK dividend growth stocks to consider in 2023. Croda International Plc (LSE:CRDA.L) has decades of consistent dividend increases under its belt. Earlier this year Croda International Plc (LSE:CRDA.L) again upped its dividend. Its CEO Steve Foots said in an earnings call:

“And I’ve been really pleased with our ability to manage significant raw material cost inflation. We haven’t seen that for about 15 years in the group, sign of a strong business when you can move profits forward. Price/mix was a massive 24%, reflecting the need to recover these costs. And we’ve announced an 8% increase in the full year dividend, continuing our unbroken track record of dividend growth of more than 30 years.”

You can also take a peek at 12 Best 5G Stocks To Buy Now and 10 Best Fast Growth Stocks To Buy.