With the Reserve Bank of Australia pushing the official cash rate all the way down to the historic low of 2.5%, it's a sure thing that the RBA is not encouraging you to save your hard earned money in the bank. It's a sad situation for savers and retirees who rely on a deposit account. Thankfully, investors who understand the benefits that the share market can provide are not bound by the skinny returns of a deposit account, but rather they can seek out significantly better opportunities.
Given these circumstances it's easy to see why investors, particularly those thinking about their superannuation and the need to draw down upon it, are focusing on stocks with high dividend yields.
The key here is to accurately identify stocks which can maintain and ideally grow their dividends going forward. Otherwise a reliance on historic yields will prove futile.
Here are three stocks which are all currently trading on very attractive fully franked yields:
RCG Corporation Limited (ASX: RCG) issued a profit downgrade last week but the footwear retailer is still forecasting growth of 10% to 12% this financial year. That should allow the company to continue to grow its dividend with research provided by Morningstar suggesting dividends totalling 4.5 cents per share (cps) could be paid in FY 2015. On this forecast, the stock is trading on a hefty yield of 7.75%.
Countplus Ltd (ASX: CUP) offers accounting services which by and large provide a reasonably stable level of recurring revenues for shareholders. Analyst consensus has earnings per share growing, but dividends remaining flat at 12 cps. With the shares price at $1.77, the stock is yielding 6.8%.
STW Communications Group Ltd. (ASX: SGN) is set to grow its marketing and communications business at a low rate over the next couple of years. While the growth rate is not exactly exciting, it should allow the board to raise the dividend to 9.3 cps in FY 2015. This forecast implies the stock is trading on a forward yield of 6.9%.
