Transurban Group (ASX: TCL), Sydney Airport Holdings Ltd (ASX: SYD), APA Group (ASX: APA), Westfield Corp Ltd (ASX: WFD) and RCG Corporation Ltd (ASX: RCG) could deliver steady income to budding long-term investors.
Transurban
Transurban is Australia's dominant toll road operator and owner. Its assets include the Lane Cove Tunnel, Hills M2, Airport Link M7, CityLink and much more.
Since it is very difficult (and expensive!) for a competitor to uproot an existing toll road owner or build a new highway or tunnel, companies like Transurban often generate lots of recurring cash flow. Transurban is forecast to pay a 4.2% dividend in the year ahead.
Sydney Airport
Sydney Airport Holdings owns (yep, you guessed it) Sydney Airport, Australia's busiest airport. The company makes money from every traveller which passes through its gates.
It also generates sales by charging retail outlets rent and by offering complementary airport services like car parking. News of the Western Sydney Airport, expected to be built in the next decade, appears to have investors spooked. However, Sydney Airport Holdings is forecast to pay a dividend equivalent to a yield of 5%.
APA Group
Another infrastructure owner, APA Group is Australia's toll road and car park for natural gas. It owns an extensive pipeline network and distribution facilities. Given the company's exposure to Australia's increasingly important natural gas industry, I think APA could be a good way to get exposure to the resources sector. APA Group is forecast to pay a 4.6% dividend.
Westfield Corp
Westfield Corp is the global arm of Westfield shopping centres, with key assets in the USA and UK. As a result, the company is a near direct play on American consumer spending and overall economic prosperity.
The $18 billion property company is tipped to offer a 3.7% dividend in the year ahead.
RCG Corporation
RCG is the smallest company on this list, worth around $570 million, and arguably the riskiest. The retail company owns footwear stores such as The Athlete's Foot, Hype DC and much more. It is also the exclusive distributor of popular brands like Saucony, Merrell and Timberland.
The company has grown quickly by acquisition, with its share price up 550% in 10 years. It is forecast to pay a dividend of 5.6% fully franked.
Risks
Dividend shares can provide reliable — sometimes tax effective — income to shareholders. However, although dividends are reliable they are far from guaranteed. Indeed, there is nothing to say dividends cannot be reduced or cut completely from year to year.
It is up to you to build a portfolio of steady dividend-paying shares if you want to secure a consistent income from the sharemarket.
