We have some exciting news to share! The Motley Fool UK has now become The Twelfth Magpie -- an independent, UK-owned company, led by our long-serving UK management team — Mark Rogers, Chris Nials and Heather Adlington. In practical terms, it’s the same team you know, now fully focused on serving our UK readers and members.

Just as importantly, our approach remains unchanged: long-term, jargon-free, and on your side. This site is our new home, and there will be extra tweaks made across the coming few days as we settle in. So if anything looks a little off, please bear with us!

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Here are the best dividend-focused stocks to buy right now, according to experts

Zaven Boyrazian highlights a couple of dividend-focused stock picks from institutional analysts that could deliver impressive results in 2026.

| More on:
Older couple walking in park

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

As 2026 kicks off, investors are already busy hunting for the best stocks to buy. And while there are lots of potential candidates for top performers this year, professional institutional investors have their sights locked onto just a handful of quality UK shares.

Here are what the pros think are worth considering.

XXX

1. Incoming rebound for pizza?

Domino’s Pizza Group (LSE:DOM) had a pretty rough 2025. Weak economic conditions hampered demand for pizza takeaway, resulting in lacklustre growth. Throw in the added pressure of inflation on its bottom line leading to earnings stumbling and, ultimately, the CEO stepped down from his role.

With all that in mind, seeing Domino’s shares fall by over 30% since January last year isn’t a major surprise. But could this be a buying opportunity? The analysts at Peel Hunt certainly seem to think so.

With Domino’s free cash flow remaining strong supporting its 6.2% dividend yield, its technological competitive advantages intact, and its price-to-earnings ratio sitting at just 9.1, the stock’s valuation now looks divorced from the underlying business. And subsequently, the shares could see a rapid recovery once UK economic conditions recover.

Of course, there’s no guarantee this recovery will happen anytime soon. If fragile consumer confidence persists throughout 2026 and into 2027, Domino’s shares could remain in dirt-cheap territory for a while. Nevertheless, with the challenges surrounding the company seemingly temporary, it could be a dividend stock worth investigating further.

2. Business communications

Another stock to buy, according to Peel Hunt, is the business communications specialist Gamma Communications (LSE:GAMA). The firm specialises in helping corporations move away from traditional phone systems and use cloud-based internet communications instead.

Like Domino’s, the last 12 months have also been a bit rough for the FTSE 250 stock, falling by more than 30%.

Wider economic uncertainty has seen a sharp drop in demand for Gamma’s services among small- and medium-sized businesses (SMBs) in the UK. And alongside other headwinds, management went on to reduce its earnings guidance, spooking investors in the process.

Yet the experts at Peel Hunt, once again, see a buying opportunity. As UK economic conditions improve, IT investments among SMBs are expected to recover. And looking to the longer term, the secular tailwind of switching to cloud-based communications remains intact.

Perhaps a yellow flag for investors to consider carefully is the upcoming departure of the group’s CFO in March. Considering the business is at a critical junction, navigating through a tough operating landscape, a leadership transition introduces significant execution risk, especially if a talented successor isn’t identified in time.

Nevertheless, with its long-term trajectory still intact and the price-to-earnings ratio sitting at just 12.7, the bar for performance seems to have been set relatively low.

For income investors, the yield may not look too impressive at just 2.3%. But with the company currently on track to deliver its 10th consecutive year of dividend hikes backed by cash flows, this payout could eventually grow to something far more substantial in the long run.

Zaven Boyrazian has no position in any of the shares mentioned. The Motley Fool UK has recommended Domino's Pizza Group Plc and Gamma Communications 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.

More on Investing Articles

Friends and sisters exploring the outdoors together in Cornwall. They are standing with their arms around each other at the coast.
Investing Articles

£503 buys 14 shares in this FTSE 250 stock that returned 23.9% annually for the last 15 years

This FTSE 250 stock has averaged a huge return for 15 years. At today's price, £503 buys 14 shares. But…

Read more »

Black woman using loudspeaker to be heard
Investing Articles

£1,000 buys 25 shares in this FTSE 100 stock that’s returned 29.2% annually for the last 10 years

This FTSE 100 mining stock has returned close to 30% a year for a decade. At 3,995p, £1,000 buys 25…

Read more »

Female student sitting at the steps and using laptop
Investing Articles

Down 47%, is this growth stock finally worth buying in May?

With a £288m order book and a hidden pipeline of defence and nuclear contracts, is this growth stock now too…

Read more »

House models and one with REIT - standing for real estate investment trust - written on it.
Investing Articles

2 REITs yielding 7%+ to consider for passive income in 2026

A REIT backed by the NHS and another backed by Tesco and Sainsbury's with both yielding 7%+. Here's why I'm…

Read more »

Woman riding her old fashioned bicycle along the Beach Esplanade at Aberdeen, Scotland.
Investing Articles

Just 97 shares of this UK dividend stock generate £238 in passive income

A 5.7% yield, £238 in passive income from just 97 shares, and one of the most divisive dividend stocks on…

Read more »

ISA coins
Investing Articles

£10,000 in an ISA generates a second income of…

The London Stock Exchange is home to some of the world's most generous dividends. But how big a second income…

Read more »

Shot of a senior man drinking coffee and looking thoughtfully out of a window
Investing Articles

Expert recommendations: 2 top income stocks yielding 7%+!

With yields of 7.2% and 7.8% respectively, these two income stocks are catching the eyes of institutional analysts. Should investors…

Read more »

Illustration of flames over a black background
Investing Articles

3 top income-focused stocks to buy in May 2026, according to experts

Looking for a stock to buy for income in May 2026? Experts have flagged these three UK dividend shares as…

Read more »