This week the shareholders of two of Australia's Big Four banks will have their final dividends land in their bank accounts.
On Tuesday National Australia Bank Ltd. (ASX: NAB) will pay its 99 cents per share fully franked dividend. Then on Friday Australia and New Zealand Banking Group (ASX: ANZ) will pay its shareholders a fully franked 80 cents per share dividend.
All in all, approximately $5 billion of dividends will be paid out by the two banking giants this week. While some investors will live off this income, others may wish to reinvest it back into the share market.
Here's where I would reinvest my dividends:
Mantra Group Ltd (ASX: MTR)
I believe this leading accommodation provider has the wind in its sails thanks to the tourism boom. This could mean demand for its rooms remains strong for at least the next few years, allowing the company to grow earnings and its dividend at a solid rate. At the current share price, Mantra is expected to provide investors with a fully franked 4% dividend over the next 12 months.
Retail Food Group Limited (ASX: RFG)
The master franchisor of the Gloria Jean's, Donut King, and Michel's Patisserie brands has enjoyed a strong FY 2016 which saw net profit after tax grow 20.5% to $66.4 million. Pleasingly management has forecast for another 20% jump in earnings next year. With its shares changing hands at 15x full year earnings and providing an estimated 4.4% fully franked dividend, I think Retail Food Group is in the buy zone right now.
Village Roadshow Ltd (ASX: VRL)
The film distributor and cinema and theme park operator's mixed performance in 2016 has led to its share price plunging a massive 40% year to date. At the current price investors should expect to receive a fully franked 6.5% dividend in FY 2017. Since the tragic incident at rival theme park Dreamworld, visitor numbers to its own parks have been lower than normal. But I believe this will soon improve and I expect the company to reap the rewards of the tourism boom over the next few years.
