At the moment it’s hard to see much value out there in the income side of the market. Businesses such as the big four banks, second tier banks, the insurance giants and other infrastructure stocks are all trading at the highest they have been for a while.
However, I think there are still a few stocks that are trading at attractive value for income investors:
Mortgage Choice Limited (ASX: MOC) is one of Australia’s largest loan brokers and receives a trailing commission for each loan that it creates.
It’s grown or maintained its dividend every year since 2009 yet the share price is 20% lower than its 2015 high of $2.93. It’s currently trading with a trailing grossed-up dividend yield of 10.38%.
Crown Resorts Ltd (ASX: CWN) is still around 9% lower than it was before some of its employees were arrested in China. I think now is a good time to buy whilst short-term sentiment is negative but there is a long-term opportunity with its projects such as Barangaroo in Sydney.
Crown announced that it will commit to paying an annual 60 cents per share as dividends which means it has a partially franked dividend yield of 5.01%.
WAM Research Limited (ASX: WAX) has been one of the best performing listed investment companies over the last five years thanks to a strong performance by its portfolio run by Geoff Wilson and his team.
It has increased its dividend every year since the GFC and currently has a trailing grossed-up dividend yield of 7.86%.
Japara Healthcare Ltd (ASX: JHC) is one of the largest aged-care providers in Australia. The share price is 41% lower than its 2015 high due to the uncertainty of government funding. However, in the long-term I think the revenue will stabilise one way or another.
Japara is currently trading with a trailing grossed-up dividend yield of 8%.
5 stocks under $5
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Motley Fool contributor Tristan Harrison owns shares of JAPARA DEF SET and WAM Research Limited. The Motley Fool Australia has no position in any of the stocks mentioned. 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.