As the European market shows signs of optimism with hopes for interest rate cuts, Sweden's Riksbank has already taken steps to reduce borrowing costs, aiming to stimulate economic growth. In this favorable environment, dividend stocks can offer a reliable income stream and potential capital appreciation. When considering dividend stocks in such a dynamic market, it's crucial to focus on companies with strong financial health and consistent payout histories.

Top 10 Dividend Stocks In Sweden

Click here to see the full list of 22 stocks from our Top Swedish Dividend Stocks screener.

Let's take a closer look at a couple of our picks from the screened companies.

BioGaia

Simply Wall St Dividend Rating: ★★★★☆☆

Overview: BioGaia AB (publ) is a healthcare company that provides probiotic products worldwide and has a market cap of SEK12.91 billion.

Operations: BioGaia AB (publ) generates revenue primarily from its Pediatrics segment, which accounts for SEK1.07 billion, and its Adult Health segment, contributing SEK288.68 million.

Dividend Yield: 5.4%

BioGaia's dividend yield of 5.4% places it in the top 25% of Swedish dividend payers, but its dividends have been volatile over the past decade and are not well covered by free cash flows, with a high cash payout ratio of 193.5%. Despite trading at a favorable P/E ratio (32.1x) compared to industry peers, recent earnings reports show strong growth in sales and net income, suggesting potential future stability.

• Get an in-depth perspective on BioGaia's performance by reading our dividend report here.

• Our valuation report here indicates BioGaia may be undervalued.

Bulten

Simply Wall St Dividend Rating: ★★★★☆☆

Overview: Bulten AB (publ) manufactures and distributes fasteners and related services for various industries including automotive and consumer electronics, with a market cap of approximately SEK1.63 billion.

Operations: Bulten AB (publ) generates SEK5.95 billion in revenue from manufacturing and distributing fasteners and related solutions across various industries, including automotive and consumer electronics.

Dividend Yield: 3.2%

Bulten's dividend payments, covered by both earnings (57% payout ratio) and cash flows (30.9% cash payout ratio), offer some assurance despite a volatile track record over the past decade. The dividend yield of 3.22% is lower than the top 25% of Swedish dividend payers. Recent earnings showed modest growth in sales to SEK 1.47 billion but a slight decline in net income to SEK 34 million, indicating potential challenges ahead for sustained dividends.