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.

£5,000 buys 4,793 shares in this FTSE 250 dividend stock yielding a huge 7%

This stock currently sports a dividend yield of around 7%. But the share price is rising and the yield may not be that high for much longer.

| More on:
A black male doctor chats to a senior patient on the hospital ward ,with a young female nurse wearing a hijab attending to a dressing

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.

While UK dividend stocks have seen their share prices rise recently, there are still some big yields on offer for income investors. According to my data provider, there are nearly 50 stocks in the FTSE 350 index with forward-looking yields of 6% and higher.

Below, I’m going to highlight a stock in the FTSE 250 index that currently sports a yield of around 7%. Could this name be worth considering for an income portfolio?

XXX

A UK property stock throwing off tons of cash

The stock in focus today is Primary Health Properties (LSE: PHP). It’s a real estate investment trust (REIT) that’s focused on healthcare properties in the UK and Ireland.

Currently, it has a portfolio of around 1,140 properties (worth a total of around £6bn). The majority of these are GP surgeries, with other properties let to NHS organisations, the Health Service Executive (HSE) in Ireland, pharmacies, and dentists.

At present, the stock trades for around 104p. That means a £5,000 investment would buy 4,793 shares (ignoring trading commissions).

The dividend forecast for the 2026 financial year is 7.31p per share (a 7% yield as noted above). That means that a £5k investment could potentially generate income of around £350 per year.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

A compelling investment case

There’s a lot to like about this stock, in my view.

For a start, a large chunk of the company’s rental income is backed by the UK government (and most of its rental agreements are long term in nature). So, it’s much lower risk than a lot of other REITs.

Secondly, the UK’s rapidly ageing population should provide a long-term growth driver. In the years ahead, demand for healthcare in this country is only likely to rise as the general population gets older.

Third, it has a fantastic dividend growth track record – recently it notched up its 30th consecutive annual dividend increase. There are not many stocks in the market with that kind of track record.

Finally, the shares are in a strong upward trend right now. Note that analysts at Berenberg see the upward trend continuing – they recently raised their target price to 128p from 122p.

What’s are the risks?

Now, the stock isn’t perfect, of course.

One risk to be aware of is that the company recently acquired rival Assura for £1.6bn. This has increased its debt.

At the end of 2025, net debt stood at £3.4bn. This could be a drag on profits (and dividend growth), especially if UK interest rates remain elevated.

The integration of Assura is also potentially a risk. The company is hoping that the deal will create significant synergies, however, acquisitions don’t always go as planned.

Worth a look today

Overall though, I see the risk/reward proposition as very favourable. In my view, this high-yielding UK dividend stock is worth considering for an investment portfolio today.

Edward Sheldon has no positions in any shares mentioned. The Motley Fool UK has recommended Primary Health Properties 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 »