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I'm looking for the best stocks to boost my passive income in 2025. During my search, I focused on the following interesting dividend stocks from the FTSE 100 and FTSE 250.
Dividends are never, ever guaranteed. But if brokers' forecasts are accurate, a lump sum of £15,000 invested equally in these three dividend stocks would provide a second income of £1,320 next year alone.
I am sure they could generate large and growing dividends over time and also in the longer term. Here's why I'm considering them for my portfolio.
sunbeam
The outlook for renewable energy stocks like Foresight Solar Fund has been complicated by Donald Trump's upcoming return to the White House.
Its plans to boost the fossil fuel sector could negatively impact investor demand for green energy stocks starting next year. Potential trade tariffs could also introduce supply chain challenges for key hardware such as solar panels.
That said, I think some sector-wide share price pullbacks are now playing into this danger.
Take the Foresight Solar Fund for example. Its share price has fallen 10% over the last month. As a result, the company now trades on a rock-bottom price-to-earnings (P/E) ratio of 9.5 times for next year.
At this valuation, I think the company, which has operations in the UK, Italy and Australia, deserves a lot of attention. The worsening climate crisis means that renewable energy capacity still has considerable room for growth, regardless of US actions.
Some also argue that weaker investment in green energy in the United States will help British and European companies by making components cheaper and easier to source.
I also think that overall Foresight Solar remains low risk despite recent political events. After all, electricity demand remains largely unaffected by broader economic conditions.
So far, this has provided the fund with stable profits and cash flows and therefore the ability to generate a strong dividend year after year.
Growth opportunities
Financial services providers face a more uncertain outlook in 2025 as the global economy falters. Aviva may also face more challenges than others, given its focus on the stagnant UK.
However, I am still tempted to increase my holdings today. First, I invest based on a company's long-term earnings potential. And I think Aviva's is considerable, and especially in areas like pensions and annuities as the population ages rapidly.
I believe the industry giant has the scale and brand power to make the most of this opportunity. It has grown its customer base to 19.6 million, up 1.2 million in just four years.
I also believe that the current difficult conditions for consumers are due to their low rating. Today, Aviva shares trade on a 2025 P/E ratio of 9.3 times.
Finally, I think the business appears to be in good shape to deliver more large dividends in 2025, even if earnings disappoint. This is thanks to its considerable cash reserves. The Solvency II ratio here was 195% in September, almost double the required level.
A strong balance sheet also gives Aviva plenty of room to invest for growth. I think it's one of the best deals on the FTSE 100 today.
