When building a portfolio of dividend stocks, price is not usually a factor. Still, it doesn’t hurt to see that my income stocks perform like growth stocks from time to time.

This month I had a huge surprise in the form of dividend stocks that have produced very little returns over the last year.

Keeping the nation connected

The country’s leading telecommunications company, BT Group (LSE:BT.), is up a massive 25% in the last month. This makes it the most effective share in FTSE100 in May. Combined with a decent dividend yield of 6.3%, this gives very good returns.

Naturally, the price won’t raise that much each month. So what caused the sudden spike?

A huge cloud of debt has been hanging over BT’s head for some time now. At £18.5 billion, this is around 50% more than the company’s market capitalization of £12 billion. The situation is not helped by falling share prices. However, it is close to completing its costly fiber broadband rollout and last month announced positive financial results for 2023. Adjusted revenues and earnings before interest, tax, depreciation and amortization (EBITDA) increased slightly, as did net cash flow and earnings per share (EPS). .

If dividends are well covered by profits, the risk of suspension of payments is low, even in the event of periodic delays in results. However, despite the good coverage, analysts predict that the yield will drop to 6.1% in the coming years. This may be due to tardy growth in profits and revenues, which are expected to remain low for the next three years.

The best British TV

ITV (LSE: ITV) is up just 11.8% this month, but has a slightly higher yield than BT, at 6.5%. It also has a similar payout ratio of just under 100%, which allows it to cover enough earnings to support payments. Like BT, payments were paused during Covid but have returned to the same consistent reliability. However, unlike BT, profitability is expected to raise to over 7% in the coming years. This proves analysts’ confidence in the broadcaster’s future.

However, the raise is minimal compared to the 28% price decline that has occurred over the past five years. Although it is on track, there is still a long way to go before it returns to its 2015 peak. Top British shows like Love Island AND Voice are growing revenues, but still face stiff competition from video-on-demand platforms such as Netflix.

An industry under fire

A immense British tobacco company Imperial Brands (LSE: IMB) has the highest yield on this list at 7.72%, but is only up 5% this month. Still, that’s higher growth than most other dividend stocks I own.

The downside is that tobacco is a risky industry and global regulations restrict cigarette sales. While it is making some progress with Next Generation Products (NGPs), there is a risk that its products will also become regulated in the future. That’s why I’m cautious about how long its business model can remain profitable.

But for now, it’s a good dividend payer. It currently pays an annual dividend of £1.46, which is well covered by EPS of £0.244. Profitability is also forecast to raise to 9% in the coming years. So, while the industry may eventually die out, I hope to enjoy the profits for at least a few years.