MENU

Seeking income? 3 high-yield dividend shares to buy today

Credit: NAB

With the cash rate at a record low in Australia, deposits in “high-interest” savings accounts are barely beating the inflation rate once you take into consideration tax implications. It’s no wonder that investors are on the hunt for quality companies that pay sustainable, high-yield dividends. Here are three of my current favourites that I believe income-seeking investors should consider:

Retail Food Group Limited (ASX: RFG)

Retail Food Group is a global franchisor and coffee wholesaler. It operates through well-known brands such as Gloria Jean’s Coffee, Donut King and Di Bella Coffee. The group started out in 1989 operating 50 Donut King stores and has grown into a $1 billion dollar public company with over 2,500 outlets throughout Australia, Asia, Europe and the United States.

Since listing in 2006, Retail Food Group’s growth has seen its share price increase by over 500%. The company has ambitions for further international expansion and recently affirmed its expectations for underlying profit growth of 20% for FY2017. Retail Food Group has managed to increase its dividend payout on the last 21 occasions and currently yields 5.5%, fully-franked.

ASX Ltd (ASX: ASX)

ASX operates Australia’s primary securities exchange. It has only a single, much smaller competitor in terms of providing a trading market (matching buyers and sellers) and enjoys a monopoly on clearing and settlement, which is when actual money changes hands. The company has defensive qualities somewhat similar to listed infrastructure operators like Sydney Airport Holdings Ltd (ASX: SYD), yet to me it appears to have a much lower profile among investment commentators.

Regardless, ASX has become popular among income investors of late. The company’s share price is up 20% in the last 12 months, which has brought its fully-franked dividend yield down to around 3.9%.

National Australia Bank Ltd (ASX: NAB)

I know its an obvious choice, but NAB’s 6% fully-franked dividend makes it impossible not to mention here. There aren’t many top companies on the ASX that can match the big banks on yield, and I believe they will continue to reward income investors for the foreseeable future. The banking sector reported strongly during the recent earnings season and investor confidence in the Big 4 has returned. NAB in particular has performed well and its share price is up more than 20% in the last 12 months.

Of the three companies I’ve mentioned, ASX is my favourite due to its defensive characteristics and monopoly on certain parts of its operations. However based on current market prices, I believe Retail Food Group could offer investors superior long-term returns.

5 things every SMSF must do in 2017

Whether you've been running an SMSF for many years, or you've only just established one more recently, the income tax and regulatory environment in which SMSFs operate can be quite convoluted.

We've put together a list of the five most important things that we believe will help you keep your SMSF on the straight-and-narrow now and into the future.

Simply click here to access...

Motley Fool contributor Ian Crane owns shares of ASX Limited, National Australia Bank Limited, and Retail Food Group Limited. The Motley Fool Australia owns shares of Retail Food Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

HOT OFF THE PRESSES: My #1 Dividend Pick for 2017!

With its shares up 155% in just the last five years, this ‘under the radar’ consumer favourite is both a hot growth stock AND our expert’s #1 dividend pick for 2017. Now we’re pulling back the curtain for you... And all you have to do to discover the name, code and a full analysis is enter your email below!

Simply enter your email now to receive your copy of our brand-new FREE report, “The Motley Fool’s Top Dividend Stock for 2017.”

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.