After all, investing in large-cap companies has allowed countless UK investors to make their plenty of money down the years.

But there’s a treasure trove of top stocks below the major indices that can also help individuals make serious money. And with dividends rising from smaller companies on the Alternative Investment Market (AIM), now could be a good time to go hunting for some lesser-known companies.

AIM dividends keep soaring

According to Link Group, dividends from AIM-listed companies rose 7.4% in the first half of 2022 to £574m. However, the data business says that the level of total payouts was held back by fewer special dividends. Stripping out these one-off rewards, dividends surged 19.8% year on year.

Link Group says that “the strong underlying rate of growth in the first half of 2022 follows a rapid rebound in 2021 from the pandemic”. Last year, dividends jumped 60% from 2020 levels (or 39.9% excluding special dividends).

And for the current year Link expects total dividends from AIM stocks to rise 2.5% year on year to £1.22bn. On an underlying basis it’s predicting growth of 13.3%.

Two dividend stocks to buy

With this in mind here are two AIM stocks I think could deliver healthy dividend income for years to come.

1. Begbies Traynor Group

Insolvency specialist Begbies Traynor’s (LSE: BEG) hunger for accquisitions leaves it at risk of unexpected costs or overpaying to generate growth. But I’m highly encouraged by the firm’s record on this front and think earnings could soar as insolvency cases in the UK rocket.

Begbies Traynor’s grown the annual dividend by around 8% in the past four years. City analysts think another such hike is due this year too, resulting in a 2.6% dividend yield.

City analysts think the company’s earnings will rise 9% in the current financial year. This means the predicted dividend is also covered 2.6 times, well inside the safety benchmark of 2 times and above. There’s a high chance then that Begbies Traynor will make this expected payout.

2. Greencoat Renewables

I think Greencoat Renewables (LSE: GRP) is a perfect income stock to buy for these uncertain times.

Electricity demand remains broadly stable at all points of the economic cycle. Consequently this AIM business — which owns wind and solar power assets in Ireland and Continental Europe — should have the means to pay dividends even if the global economy tanks.

This view is shared by City brokers. And so Greencoat Renewables carries a fatty 5.1% dividend yield for 2022.

My main concern with buying renewable energy stocks like this is the huge cost it takes to set up wind farms and other low-carbon assets. This can take a big bite out of the balance sheet.

But, on balance, I think Greencoat’s will prove a brilliant buy for the long term as demand for clean energy heats up.

Momentum in the hydrogen space

The first green stock I like is ITM Power (LSE:ITM). The business designs, manufactures, and integrates electrolysers to produce green hydrogen. It has a range of commercial potential uses, including as fuel. The only waste is water and green hydrogen can be stored in tanks for long periods of time — it’s easy to see why people are excited.

ITM Power is really starting to get up and running. The stock won a project grant from the German government in January. It has secured investment from the UK government last November for the first phase of an ongoing project at the Whitelee Windfarm hydrogen facility.

The share price is down 11% over the past year, but up 50% over two years. I think that with momentum from the recent investments and the prospect of increased production in the next year or so, the share price could really start to take off.

There is some risk that the market finds issues with green hydrogen in practice, but for the moment I think it’s a viable form of clean energy for the future.

A green investment stock

Another company that fits the bill is Greencoat Renewables (LSE:GRP). I think this is a no-brainer buy not for share price growth, but rather for dividend income in my portfolio. The company invests in wind and other renewable energy projects in Europe, with the aim of distributing returns via dividends. Currently the dividend yield sits at 5.22%, with the share price up 1% over the past year.

Wind energy is an area of high public and private investment, and one that I think will continue in the future. I like the fact that Greencoat has project in different countries in its portfolio. Although there is a lot of exposure in Ireland, it also has projects in France, Spain, Finland, and Sweden. This should diversify business streams in the future, helping to mitigate any potential problems.

I do know that getting wind projects up and running can be very expensive. This might make it tough for Greencoat to step up to the next level as private investors might favour cheaper green energy options. However, I think there is enough funding already in this space to ensure the dividends stay generous and consistent.

I think that both green stocks will perform very well in the future given the sector. Therefore, I’m wanting to buy shares in both companies at the moment.

Assurance and risk management business DNV expects electricity consumption worldwide will rise 10% between now and 2050. It predicts that green energy consumption will soar past demand for fossil fuels too.

DNV also thinks solar power will account for between 40% and 45% of all electricity by the middle of the century. It predicts too that wind power will be responsible for between 30% and 35%.

3 renewable energy stocks I’d buy

So which renewable energy stocks should I consider buying for my portfolio? Here are three green power giants on my radar right now.

#1: US Solar Fund

As DNV says, solar power looks set to be the most popular form of green power going forward. This is why I think buying US Solar Fund could be a good idea.

You may have guessed that this fund focusses on investing in solar farms in the US. This is another reason I like this particular energy share as government support for the solar sector is particularly strong in the States.

One problem with solar power is that the pollution it emits is higher than that of other renewable sources. This means legislation helping the industry might not be as favourable in the future.

Still, as things stand today, I believe the potential rewards of owning US Solar Fund shares outweigh this risk.

#2: Greencoat Renewables

I also like Greencoat Renewables because of its geographic footprint. In this case, its assets can be found in Ireland, France, Spain, Sweden and Finland.

This is important because power generation from renewable sources can be extremely unpredictable. When the sun doesn’t shine and the wind doesn’t blow, profits can take a significant hit.

The uncertainty related to weather conditions is still a risk to Greencoat Renewables, which focuses almost entirely on wind farms. But, in my opinion, it offers more security than businesses whose assets cluster around a smaller area. It can realistically expect favourable weather conditions to reign in some of its territories at all times.

#3: Gore Street Energy Storage Fund

The erratic nature of renewable energy generation actually plays into the hands of firms like Gore Street Energy Fund.

This renewable energy stock buys and builds battery storage assets which accumulate power and deploy it as and when needed. It therefore plays a critical role in keeping the flow of electricity moving when power generation from wind turbines and the like begins to drop.

Gore Street is focused on the UK and Ireland, though its current pipeline is geared toward expanding in the US and Western Europe. Demand for its services looks set to grow rapidly as the number of green energy projects soars.

I’d buy Gore Street even though rising competition in the energy storage industry poses a potential threat.

Points to consider before investing

One point that will influence where I decide to invest will be what my existing Stocks and Shares ISA looks like. For example, if it’s full of dividend stocks, I might want to consider buying some growth stocks instead. Or if I’m heavily concentrated in holding stocks from a particular sector, I should probably think about including some other areas.

In addition to this, I want to think about what goal I have for the £1,000. Is this money that I ideally want to try and use to protect against a stock market crash? In that case I’m best off considering some defensive stocks. Or is this money that I want to put to work to try and beat inflation, currently running at 5.5%? If so, then I want to consider some more aggressive options, including some higher-risk growth stocks.

Fortunately, whatever the answers to those questions are, my Stocks and Shares ISA can be of use. The benefit of not paying capital gains tax or dividend tax on any proceeds allows me to take advantage of any profits or income I can generate.

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. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

My personal favourites for a Stocks and Shares ISA

Currently, there are a few stocks that have caught my eye since we started the year. In the big pharma space, AstraZeneca continue to impress me. Full-year results out last week showed total revenue increased by 41% year-on-year. It also has a strong pipeline of new medicines for this coming year. This includes recent successful Phase 3 trial results of a treatment for prostate cancer. Although it’s going to have higher costs due to a transformation taking place, I think it’s a solid long-term buy for my ISA.

For dividend options, it’s hard not to like the 8.83% dividend yield for Rio Tinto. It has a 10-year dividend growth rate of 19%, showing that the current dividend payouts aren’t just a flash in the pan. This is a higher-risk option, due to the correlation in earnings to the commodity prices that it mines. 

Finally, I’d also consider adding Greencoat UK Wind to my Stocks and Shares ISA ahead of the deadline. It ticks the box of being a renewable energy stock, an area that I think will grow for many years to come. It also has a commitment to increase the dividend in line with RPI inflation, so this should help provide a buffer if inflation keeps moving higher. As a risk, the share price is currently trading at a premium compared to the actual net asset value of the business, which could mean it’s overvalued for now. That means I may consider buying on any pre-deadline dips.

With that in mind, here are three companies I would buy for my portfolio for income today. 

Best stocks to buy for income and growth

Premier Miton (LSE: PMI) has carved out a niche in the asset management market. As investors have flocked to the group’s products, its revenues and profits have grown rapidly. Profits have more than doubled over the past five years. 

Unfortunately, there is no guarantee this growth will last. The asset management market is incredibly competitive. Premier has to fight for market share, and there is no assurances it will be able to maintain an edge over the competition. 

Still, the company has managed to maintain that edge over the past five years. During this time, the firm has steadily increased its dividend to investors, suggesting that the payout could increase further if earnings continue to expand. At the time of writing, the stock supports a dividend yield of 6.7%. 

Expanding market

Greencoat Renewables (LSE: GRP) invests in renewable energy assets across Ireland. It is one way to invest in the rapidly growing green energy sector, managed by an experienced operator.

Greencoat operates several funds in the renewable energy market, which gives it an edge over competitors and may provide the company access to the best deals. 

Getting the right deals is the biggest challenge the corporation faces. As competition in the sector heats up, more money is chasing fewer deals. This could impact returns from these assets and lead to buyers overpaying. 

I will be keeping an eye on this challenge as we advance. In the meantime, the stock supports a dividend yield of 5.2%. There is significant potential for the business to expand its renewable asset portfolio over the next few years. 

Portfolio expansion

Student accommodation provider Unite (LSE: UTG) has been investing heavily in increasing the size of its property portfolio over the past couple of years. As demand for purpose-built student accommodation has grown, the company has been able to capitalise on this booming market.

It is difficult to tell how the market will evolve as interest rates rise. Unite has £1.1bn of debt, and the cost of servicing these borrowings will increase with higher rates. This is probably the biggest challenge the group faces today. 

Nevertheless, with the student population in the UK booming, there is plenty of potential for the company to continue expanding in the years ahead. This could translate into a higher dividend payout for investors.

City analysts have pencilled in a dividend per share of 32p for the 2022 financial year, giving a yield of 3.1% on the current share price.

Gold star

I believe the stars could be aligning for gold to have a strong 2022. So buying producers of the precious metal like Pure Gold Mining (LSE: PUR) could be a good idea for me.

A worsening Covid-19 crisis could fuel strong gold price rises next year (the yellow metal struck record peaks above $2,000 an ounce in summer 2020 during the height of the pandemic). Runaway inflation as we enter the new year also bodes well for the safe-haven asset (US consumer price inflation just hit its highest since 1982).

I’d also be encouraged to buy Pure Gold, given the progress it’s making at its flagship asset at Red Lake, Ontario. Production at the Canadian asset — which Pure Gold describes as “one of the highest-grade gold mines on the planet” — jumped 54% in quarter three versus the previous three months, thanks to improved grades and greater tonnage, to 9,260 tonnes. The gold miner is seeking throughput of 1,000 tonnes per day by mid-2022, versus 685 in the third quarter, as upgrades at the site kick in.

At current prices of 42p per share, Pure Gold Mining trades on a P/E ratio of 8.9 times for 2022. This sits inside the widely-regarded value benchmark of 10 times and below. Even though development and production problems are an ever-present threat, this low valuation makes the penny stock highly attractive to me right now.

A top renewable energy stock

Electricity generator Greencoat Renewables (LSE: GRP) is another top penny stock for me to buy for a potentially-volatile 2022. Our demand for electricity remains broadly constant, despite the onset of economic, political and/or social crises. So I’m not expecting profits here to fall off a cliff if inflation keep surging and/or the Covid-19 crisis worsens.

In fact, I’m expecting earnings at Greencoat to take off as green energy grows in popularity. So do City analysts who expect this UK renewable energy stock’s profits to soar 42% in 2022. BloombergNEF has suggested wind and solar combined could account for 15% of primary energy supply by 2030, and 47% by 2040. That compares with just 1.3% today, suggesting Greencoat could be a hot growth stock for the coming years.

Greencoat’s also a great income share, in my opinion. The defensive nature of its operations provide the stability to regularly pay big annual dividends. For 2022, its yield sits at a mighty 5.6%.

Shares like Greencoat Renewables aren’t without their risks, of course. Revenues can take a smack if the wind stops blowing and energy generation grinds to a halt. It can also cost a packet to keep wind turbines spinning and expenses can balloon following extreme weather events.

Still, it’s my opinion that — all things considered — this green UK share could prove a lucrative investment over the long term.

Jobs giant

A buoyant jobs market makes Staffline Group (LSE: STAF) a great buy in my book. This business helps companies recruit and train workers, and it has performed splendidly as the UK economy has bounced back. Revenues jumped almost 5% in the six months to June.

Latest research suggests demand for workers will continue growing, too. According to Hays, some 80% of British employers plans to take on more staff over the next 12 months. Hays’s research also underlined the worsening skills shortage affecting domestic firms. A whopping 86% of companies have experienced skills shortages in the past year, the data shows.

This could also give an extra boost to Staffline Group. Its PeoplePlus division provides services like skills training and apprenticeships. Sales growth across the business could cool if the UK economy keeps struggling, but data such as that just released from Hays makes me reasonably confident recruiters like this could continue to thrive.

Another excellent penny stock

I already have exposure to the construction materials provider CRH. And I’m thinking of buying more of the FTSE 100 stock following its recent share price weakness. However, I believe another good idea could be to buy Breedon Group (LSE: BREE).

This UK share owns and operates several cement plants, ready-mix concrete plants, asphalt plants and quarries. It’s therefore in great shape to make bucketloads of cash (at least in my opinion) as British housebuilding activity increases and infrastructure spending ramps up several notches.

Breedon Group could suffer setbacks, of course, if a shortage of truck drivers persists. Strong demand for its products counts for little if the company can’t get them to its customers. That said, I’d still buy this UK share as its earnings outlook for the longer term looks mightily attractive.

Making money with green energy

If my concerns over UK economic conditions grow, however, I might be tempted to buy Greencoat Renewables (LSE: GRP). As the name suggests, this penny stock operates in the field of renewable energy. More specifically it operates a raft of windfarms across Ireland and mainland Europe.

As energy demand remains broadly stable at all points in the economic cycle, this UK share can expect revenues to keep rolling in during good times and bad. I also like Greencoat Renewables because it’s a great way to make money from the ‘green revolution’ of the 2020s. I’m a fan of its commitment to geographic expansion too (last week it acquired its first assets in Sweden).

It’s important to remember that creating energy from renewable sources can be problematic. The wind isn’t always guaranteed to blow, and this can take a big bite out of the turbine operator’s earnings. Still, I think the risk-to-reward outlook for Greencoat Renewables remains highly attractive. I’d happily add it to my own shares portfolio in November.

Riding the meat-free revolution

I recently explained why demand for Beyond Meat’s products is rising as concerns over animal welfare and the broader environment grow. But of course this isn’t the only reason why plant-based food is rising. Another is lingering concerns over the link between meat and heart disease, cancer, and diabetes.

And this is where green stock Tattooed Chef (NASDAQ: TTCF) comes in. Not only does this US share manufacture frozen plant-based foods across a variety of categories. It also offers consumers the choice of non-genetically modified and organic products. Latest financials from the company showed revenues rise 59% in the three months to March. And sales of its own-branded foods more than doubled from the corresponding 2020 period.

Turnover at Tattooed Chef is soaring as it expands its number of distribution points and rolls out new product lines. But bear in mind that the meat-free market is becoming increasingly competitive as niche firms like this, along with established food manufacturers, try to grab a slice of the action. This US share could well have a hard time trying to deliver on its exceptional promise.

Another top green stock

I believe getting exposure to renewable energy is another good idea for share investors. Several green stocks listed on the London Stock Exchange operate in this field. And Greencoat Renewables (LSE: GRP) is one that’s on my radar because of its immense value. Earnings here are expected to soar 234% in 2021, leaving the wind farm operator trading on a forward price-to-earnings growth (PEG) ratio of just 0.1. Any reading below 1 suggests that a stock could be undervalued.

What’s more, Greencoat Renewables boasts a monster 5.1% dividend yield for this year. The defensive nature of its operations, and consequently its great profits visibility, leads me to believe the UK share will keep paying above-average dividends too. Of course, dividends are never guaranteed.

Research suggests that demand for Greencoat Renewables’ services could go from strength to strength. A report from the International Energy Agency said that “renewable sources of electricity such as wind and solar grew at their fastest rate in two decades in 2020”. But this wasn’t all. The organisation predicted that “[growth rates] are set to expand in coming years at a much faster pace than prior to the pandemic” too.

I think that Greencoat Renewables, which operates a slew of wind farms in Ireland and a handful in France, is a great way to play growing demand for low-carbon energy. Though it’s important to remember that the business of energy generation can be extremely costly. And this green stock is at the mercy of future changes to environmental legislation too. Still, at current prices it’s a UK share that’s high on my investing wishlist.

One of the best green shares to buy

I believe UK shares involved in the business of renewable energy are top buys today. Demand for low-carbon energy is booming and legislative pushes across the globe means it should continue to do so too. This is where Greencoat Renewables (LSE: GRP) comes into the equation. The company operates a portfolio of wind farms, predominantly located in Ireland, and it’s expanding aggressively to drive the bottom line.

Greencoat acquired four wind farms on the Emerald Isle last year. And the company has been taking action to expand its wingspan on Continental Europe too. It started the ball rolling by purchasing three French wind farms in 2020. The UK share also entered Finland last month by spending €60m on a project that’s set for completion in 2022.

Remember that City forecasts can be blown off course (so to speak) by deteriorating trading conditions. And in the case of Greencoat Renewables this can be caused by the unpredictable nature of wind flows.

High and unexpected costs due to extreme weather damaging turbines can also hit the bottom line. But right now, analysts reckon this UK share’s profits will rise more than 170% year on year in 2021.

This makes Greencoat Renewables one of the best value dividend shares to buy right now. Those earnings projections leave the UK energy stock trading on a forward price-to-earnings growth (PEG) ratio of 0.1. A reading below 1 can suggest a stock is undervalued. At current prices the company carries a mighty 5.2% dividend yield too.

A FTSE 100 dividend star

I think those seeking gigantic dividends should also give housebuilders close attention. It’s possible that a slow economic recovery from the Covid-19 crisis could hit homes demand in Britain. Naturally this means newbuild sales could hit the skids. But I still think some of the dividend yields in this sector make these UK shares worthy of a close look.

Take FTSE 100 stock Persimmon (LSE: PSN) for instance. The dividend yield here sits at a mighty 9.1% yield for 2021. I believe trading conditions should remain strong enough for the company to keep paying large shareholder dividends long into the future as well.

Government support for buyers remains substantial and, this month, it introduced a mortgage guarantee scheme that allows Britons to buy with just a 5% deposit. It’s possible that the Help to Buy equity scheme will run well into the 2020s as well. I expect Persimmon to remain a robust profits-making machine long into the future.

#1: A UK tech share on my watchlist

Getting in on the information technology train could pay off big time in a post-pandemic landscape. Businesses around the globe have accelerated their investment in digitalisation in response to trends like growing e-commerce activity and the rise of homeworking. It’s a trend that looks set to run and run as technology improves.

I would invest in UK shares like Redcentric to hopefully make money from this phenomenon. The business provides network and cloud services that are essential to the execution of flexible working models. City analysts reckon the company’s annual earnings will soar 46% in the current fiscal year. This leaves it trading on a bargain forward price-to-earnings growth (PEG) ratio of 0.4.

UBS analysts reckon the public cloud market will grow at a compound annual growth rate of 20% to 2024. I’d expect Redcentric to deliver strong and sustained profits expansion as a result.

#2: A top stock that sits in my ISA today

I’m also expecting big things from brickmaker Ibstock (LSE: IBST) in the 2020s as housebuilding activity picks up. This week it celebrated the “robust” state of the market, which is underpinned by “a structural deficit of housing, low interest rates, and government policy, which is supportive of the role the construction sector will play in the UK economic recovery.”

Prior to Covid-19, the British government set out a target to create 300,000 new homes a year by the middle of the decade. Clearly Ibstock’s products will be essential in helping it to meet this target. City analysts reckon strong build rates will help the UK share to rocket 178% year on year in 2021. And this leaves it trading on an ultra-low forward PEG ratio of 0.1. I already own this stock in my ISA. At current prices I’m tempted to load up with some more of it too.

#3: Going green

Green energy continues to gain importance as global governments take steps to fight the climate crisis. One way that I can play this theme is by buying stock in Greencoat Renewables (LSE: GRP). This business operates wind farms the length and breadth of Ireland along with a small handful of assets in mainland Europe.

Two years ago, the Irish government announced plans to generate 70% of its electricity from renewables by 2030. This naturally gives Greencoat significant profits opportunities in its core territory. The prospect of ongoing M&A should give investors reason for further excitement too.

City analysts reckon the energy giant will record a 6% earnings rise this year, leaving it on a forward price-to-earnings (P/E) ratio of 16 times. Okay, this doesn’t offer heart-stopping value on paper. But a 5.2% dividend yield makes this UK share an attractive buy for me right now.