Image source: Domino’s Pizza Group plc
It wouldn’t be an exaggeration to call the UK market a dividend stock investor’s dream. It’s home to literally hundreds of income shares, many of which are offering yields of 5% or more.
Here are two stocks — one from the FTSE 100 and the other the FTSE 250 — that I reckon have the potential to deliver regular income and share price growth on top. They’re both yielding above 6% on a forward-looking basis.
Pizza
Domino’s Pizza Group (LSE:DOM) has had a terrible 2025, plunging 45%. And this means the FTSE 250 pizza stock is now 62% lower than it was at the start of 2022. Ouch.
This reflects sluggish growth and ongoing margin pressure at the UK master franchise of the Domino’s brand. Consequently, the dividend has been a bit all over the place, falling from 14.7p per share in 2020 to 10p in 2022 then rising to 11p last year.
Given the weak consumer environment, this isn’t a stock without risk. In November, management warned that “the tough operating environment is likely to continue to impact order counts into 2026“.
However, while challenging, things do appear to be stabilising, with Q3 total system sales up 2.1% and like-for-like system sales up 1%. For the full year, management kept its guidance for underlying EBITDA of £130m-£140m. Dividends should continue.
Meanwhile, the company says its Chick ’N’ Dip offer has started well in the North West of England and Northern Ireland. It may be rolled out across all stores in 2026, and the firm is continuing to assess opportunities for the acquisition of a second brand to kickstart growth.
The stock looks cheap at 9.4 times forward earnings, while there’s a 6.3% forward dividend yield on offer. This could be one to look at more closely for its turnaround potential, I feel.
Insurance
Next up is Aviva (LSE:AV.), which is the polar opposite of Domino’s Pizza Group. Year to date, the FTSE 100 insurance stock has surged 44%.
Over five years, Aviva has more than doubled!
Yet despite this huge run, Aviva is still sporting an attractive 6.1% forward dividend yield. And given management’s bullishness on the direction of the business, investors might be set for some strong income growth.
The outlook for Aviva has never been better. The advantages of our diversified business, 25m strong customer base, and majority capital-light earnings, mean we expect to deliver more and more for our shareholders and customers. CEO Amanda Blanc
Aviva now expects its business to be over 75% capital-light by the end of 2028. This means it will use less capital to deliver growth, which bodes well for dividends and share buybacks.
That said, a UK recession would pose challenges for Aviva, especially if it was severe enough to cause households and businesses to immediately tighten their belts.
As things stand though, the stock looks decent value, trading at 11.5 times next year’s earnings. Putting this together with the 6.1% yield, share buybacks resuming next year, as well as the recent Direct Line acquisition, and I think Aviva is still worth considering.
