Whilst Australia's big four banks pay some of the most generous dividends on the ASX, I have concerns that their valuations have become a little stretched of late.
Because of this I believe there is far more downside risk than upside potential for their shares at present.
For this reason I would suggest investors hold off starting an investment in National Australia Bank Ltd. (ASX: NAB) shares and look at these quality dividend shares instead:
Event Hospitality and Entertainment Ltd (ASX: EVT)
Event is the company behind leading accommodation and entertainment brands such as Thredbo resorts, Rydges hotels, and Event cinemas. Although its half-year result was a touch disappointing, I believe this was largely down to a freakishly strong performance from the company's cinema businesses in the prior corresponding period. I expect things to improve greatly next year, especially with the company in a strong position to profit from the Australian tourism boom. At present its shares provide a trailing fully franked 4.2% dividend.
Flight Centre Travel Group Ltd (ASX: FLT)
This leading travel agent provides investors with a trailing fully franked yield of 4.7%. Although times have been hard for the company, I remain confident that the investments it has made have set it up for strong long-term growth. Two notable investments are Shenzhen Sunny Holiday International in China and Bengaluru-based Travel Tours Group. Although they are unlikely to have a significant impact on its near-term results, I feel its presence in these two rapidly growing markets could prove to be very lucrative in the future.
Mantra Group Ltd (ASX: MTR)
Although this accommodation provider's CBD portfolio has been a bit of a disappointment in the last two years, I trust management to turn things around to complement the strong performance of the rest of the business. Much like Event, I believe Mantra is in a great position to profit from the tourism boom. As demand for its rooms increase, I believe the company will see higher occupancy levels and increasing average room rates. I expect this will put Mantra in a position to grow its generous trailing fully franked 4% dividend significantly over the next decade.
