My Top 5 Dividend Stocks For A "Crashed" Share Market
By Bruce Jackson
It's the ultimate goal for so many investors: to build a share portfolio that provides plenty of dividend income in retirement.
If you're anything like me, you're also concerned about preserving your capital and minimising your risks. Fortunately, if you diversify your holdings across different sectors of the economy, you can protect your portfolio from some of the market's gyrations.
Below are five ASX dividend stock ideas to get you started building your diversified income portfolio.
Platinum Asset Management Limited
As a fund manager, Platinum's revenues and earnings are tied to equity markets and recent volatility has made investors fearful that future earnings will fall. But Platinum has an outstanding record of outperforming the markets over the long term, which should mean a steady stream of cash flowing into its funds. With the shares trading around $6.40, Platinum are currently trading on a fully franked dividend yield of 5.8%.
Wesfarmers Ltd
Wesfarmers is the name behind popular retail brands like Coles, Bunnings Warehouse, Officeworks, Kmart and more. Trading around $42, Wesfarmers shares are forecast to pay a dividend equivalent to 4.88% fully franked in the coming year. And with its recent push into the UK, continuing outperformance of Coles and market leading positions in discretionary retailing, the dividend could grow healthily for many years.
Retail Food Group Limited
Retail Food is a master franchisor of a dozen food brands, including Gloria Jean's, Crust Pizza and Brumby's Bakery, to name a few. While it has traditionally focused on the Australian market, Retail Food Group is now expanding offshore which should provide plenty of room to continue growing over the coming years. With the share price trading around $4.45, in addition to the strong potential for capital gains, investors can also sip from the group's tasty 5.5% fully franked dividend yield.
Flight Centre Travel Group Ltd
Brand strength, overseas growth and dividends are on offer with shares of Flight Centre Travel Group. The company is expanding its US, European and digital footprint, but still offers a 4% fully franked dividend yield. With the shares trading around $40, Flight Centre is well-run yet trades at a discount valuation to the market.
Telstra Corporation Ltd
Telstra is arguably one of the ASX's most popular dividend stocks – for good reason. The $68 billion telecommunications heavyweight is the dominant force in mobiles, fixed internet, eHealth and other emerging technology markets. Coupled with a very promising Asian strategy and a cash windfall from the government's NBN Co on its way, with its shares trading around $5.65, Telstra's 5.45% fully franked dividend yield looks sustainable.
An even better bet than Telstra
My family happily owns Telstra. The fully franked dividend looks rock solid, and the company has got some exciting growth opportunities ahead.
But let's face it… valued at at $68 billion, and growing slowly, Telstra shares aren't likely to set the world on fire.
With an even bigger fully franked dividend yield…
Andrew Page, The Motley Fool's resident dividend expert, has just published a new FREE report, The Motley Fool's Top Dividend Stock for 2016, where he names his hands-down BEST dividend stock for 2016.
Not only does this company offer resilient earnings, attractive growth potential and a fat, fully franked dividend yield, unlike Telstra, it also has the potential to generate considerable capital appreciation in 2016 and beyond.
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Date updated: 29 January 2016
This report contains general investment advice only (under AFSL 400691). Please refer to our Financial Services Guide (FSG) for more information. The Motley Fool has a clear and concise disclosure policy. At the time of writing, Bruce Jackson owned shares in Telstra, Retail Food, Wesfarmers and Flight Centre. The Motley Fool, its contractors and employees may own shares in the companies listed above, and those positions may change at any time.
All returns cited are hypothetical and based on the percentage change between the stock price at the time of recommendation and the current or sell price (if the position has been closed) at the time of publication. Brokerage, taxes and any other associated costs are not taken into account. Please remember that investments can go up and down. Past performance is not necessarily indicative of future returns. Performance figures are not intended to be a forecast and The Motley Fool does not guarantee the performance of, or returns on any investment. Any money back guarantee is strictly limited to the subscription price paid for the product. Any and all advice contained in the above content is general advice that has not taken into account your personal circumstances. Please refer to our Financial Services Guide for more information.
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