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On the lookout for dividend development shares? These FTSE 100 shares are anticipated to ship robust payout development over the following couple of years not less than.
BAE Programs
Dividend yield: 2.5% for 2024, 2.7% for 2025
The steady nature of arms spending means defence tends to be a rock-solid sector for dividends. That is particularly the case right now, as fractures within the world order drive fast rearmament within the West.
BAE Programs (LSE:BA.) is one contractor with a protracted report of distinguished dividend development. It’s raised shareholder payouts yearly since 2011. It’s a pattern Metropolis analysts count on to proceed, making it price a detailed look in my view.
Payouts are anticipated to rise 8%, to 32.3p per share, this yr. Dividend development is anticipated to speed up to 10% in 2025, leading to a full-year payout of 35.5p.
Forecasts for subsequent yr are supported by anticipated earnings rises of seven% and 12% in 2024 and 2025 respectively. As a consequence, estimated dividends for each years are coated 2.1 occasions by predicted earnings.
Each readings are above the protection benchmark of two occasions, offering dividends forecasts with further metal.
BAE additionally has robust monetary foundations to fund dividends in case earnings disappoint. Earnings could fall in need of estimates resulting from provide chain points, for example, a big risk to defence companies’ annual earnings right now.
The Footsie agency had £2.8bn of money on the steadiness sheet as of June.
BAE Programs’ order backlog is surging, and it hit a report £74.1bn on the midpoint of 2025. It seems set to maintain rising too, which bodes effectively for longer-term dividends.
Airtel Africa
Dividend yield: 5.4% for 2025, 5.5% for 2026
Telecoms supplier Airtel Africa (LSE:AAF) doesn’t have a protracted report of dividend development like BAE. It’s solely been listed on the London Inventory Alternate for 5 years. It additionally minimize the annual payout in 2021 because it rebased dividends to chop debt.
Nonetheless, money payouts have surged since then, and by greater than double-digit percentages on events. It’s a pattern that Metropolis brokers count on to hold on.
For this monetary yr (to March 2025), a complete dividend of 6.52 US cents per share is predicted, up 10% yr on yr. An additional 3% rise is anticipated for monetary 2026, to six.70 cents.
Nonetheless, I have to warn that Airtel’s forecasts aren’t as sturdy as I’d ideally like.
Earnings are skidding decrease resulting from antagonistic forex actions (EBITDA dropped 16.5% between April and September). And leverage ranges are sharply rising, with net-debt-to-EBITDA rising to 2.3 occasions as of September.
Falling earnings additionally imply dividend cowl turns adverse for this yr, with predicted earnings of 46.7 US cents per share forecast. On the plus aspect, Metropolis analysts count on earnings to rebound strongly in monetary 2026, leaving sturdy dividend cowl of two.7 occasions.
But regardless of the unsure near-term outlook, I nonetheless consider Airtel Africa shares are price critical consideration by risk-tolerant buyers.
What’s extra, I consider the long-term image right here stays extremely enticing. Telecoms demand for Africa continues to rocket, with Airtel’s buyer base rising 6.1% yr on yr to 156.6m in September.
