10 Safest Dividend Stocks in the UK

5. Diageo plc (NYSE:DEO)

Number of Hedge Fund Holders: 26

Diageo plc (NYSE:DEO) is a British multinational alcoholic beverage company with over 200 brands and sales in nearly 180 countries. In the past 12 months, the stock has declined by over 26%, mainly due to a tough macroeconomic environment. However, analysts are still optimistic about the company’s future growth. Diageo leads in categories such as scotch, gin, and vodka, and its scale enables it to invest heavily in marketing, ensuring its brands stay prominent and resilient against competition. In addition, the company’s size gives it a strategic edge, allowing it to acquire smaller rivals, enhance their value, and prevent them from becoming major threats.

Scotch whisky is a major contributor to Diageo plc (NYSE:DEO)’s success, with the company owning some of the world’s top-selling brands, including Johnnie Walker. Diageo commands a dominant 39% share of the market and holds nearly half of the Scotch whisky stock currently aging, a position competitors can’t easily match. The company’s beer business is also thriving, with Guinness, its famous Irish stout, gaining significant popularity among younger American consumers. Despite rumors that Diageo might consider selling its Guinness brand due to declining net organic sales, the company firmly denied these claims, stating it had no plans to sell. In addition, Diageo will maintain its 34% stake in Moet Hennessy, the champagne and cognac company, dispelling rumors about a potential divestment.

Diageo plc (NYSE:DEO) currently pays an interim dividend of $1.62 per share for a dividend yield of 3.82%, as of February 10. It is one of the best FTSE dividend stocks on our list as the company has been growing its payouts for 25 consecutive years.