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As the race for a government job, likely to be led by Andy Burnham, begins, I thought I’d run a little challenge myself. I identified two FTSE250 dividend shares with similar characteristics – each cost around 100p per share and yield around 8%.
On the surface they look similar to income games, but when I dig into the numbers, they tell a completely different story. So what matters most if you want to live off those dividends for years to come?
A reliable REIT versus a fast-growing equipment supplier
I already own several shares in a REIT investment fund Basic health properties (LSE: PHP), but it never hurts to consider other options.
It owns government-backed healthcare facilities with long-term leases in the UK and Ireland. It has increased its dividend for 30 consecutive years, with a current yield of 7.92% and a 2025 payout of 7.1p per share.
However, REIT tax rules mean that it currently pays out substantially all of its adjusted earnings as dividends. This suits investors who want maximum cash today, but leaves constrained room to reinvest or cushion any shocks.
Please note that tax treatment depends on each client’s individual situation and may change in the future. The content of this article is for informational purposes only. It is not intended to be and does not constitute any form of tax advice.
It’s in the opposite corner International ME Group (LSE: MEGP), which operates instant service equipment such as photo booths and laundromats across Europe.
In 2025, it increased its dividend by 9.5% to 8.64p per share, representing 58% of earnings per share (EPS). This is in line with the company’s policy of paying out at least 55% of profit and translates into a dividend yield of approximately 7.9%.
Profitability and valuation
In terms of profitability, ME Group achieves a net margin of approximately 17.9% and delivers a return on equity (ROE) of 30.8%. The core company has a higher net margin of 56.6%, but a more modest ROE of 8.6% – typical of a leveraged vehicle.
The valuation is also different. Following a pointed price decline, ME Group is currently trading with a price-to-earnings (P/E) ratio of just 7.34. Meanwhile, primary school is closer to 13.86 – so the European Championship looks rather like a bargain today.
Balance sheets also matter for the sustainability of income. ME Group has net cash of £26.5m, a quick ratio of 1.17 and a debt-to-equity ratio of around 0.25, indicating comfortable liquidity and conservative borrowing.
Primary’s debt is roughly equivalent to equity, with a current ratio of around 0.5 and a quick ratio of less than 1, so it relies more on debt financing.
Side-by-side comparison
| Metric | Basic health | JA Group |
|---|---|---|
| Dividend rate | 7.92% | 8.4% |
| Payout Ratio | 107.58% | 58% |
| Dividend enhance | 2.9% | 9.5% |
| ROE | 8.6% | 30.8% |
| Net margin | 56.6% | 17.9% |
| P/E ratio | 13.86 | 7.34 |
| Approximate annual income of PLN 10,000. pounds | 792 pounds | 840 pounds |
Risk comparison
Primary’s cash flow depends on UK and Irish healthcare budgets, NHS policy and property valuation profits. Higher interest rates or political pressure on rents could reduce returns, especially with increased leverage following recent transactions.
ME Group faces greater commercial and regulatory risks: demand for photo booths may be constrained by regulatory changes, such as stricter regulations on German passport photos. In addition, the development plan assumes continued expansion of the laundry and modern products.
My verdict
For those who prioritize reliability, Primary’s long track record of dividends and government-backed leases make it more defensive. Just be aware of the high payout ratio and debt burden.
ME Group has higher profitability with a lower valuation and payout ratio. This offers greater growth potential, but only for investors who are willing to accept some operational and regulatory uncertainty.
In my opinion, both are worth considering: primary as a stable income anchor and ME as a supplement for higher growth.
This highlights a key aspect of diversification: a combination of reliability and risk can actually assist stabilize income when markets become arduous.
Is it worth investing £5,000 in Primary Health Properties Plc now?
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Mark Hartley owns shares in Primary Health Properties.
