3 dividend shares to buy instead of Westpac Banking Corp

Whilst I think that the Westpac Banking Corp (ASX: WBC) dividend is one of the best on the market right now, many investors are reluctant to invest in the banks due to concerns over the Budget levy, the bad debt cycle, and a potential housing market crash.

So for those investors I’ve picked out three dividend shares which I think are great alternatives to Westpac. They are as follows:

Dicker Data Ltd (ASX: DDR)

This year the founder-led wholesale computer hardware company plans to pay a fully franked 16.4 cents per share dividend. This equates to a generous 6.8% yield based on its last close price. Thanks to new opportunities and revenue streams from cloud services, digital transformation, and the Internet of Things, I believe Dicker Data is in a strong position to continue delivering above-average earnings and dividend growth for the foreseeable future.

Japara Healthcare Ltd (ASX: JHC)

I believe this aged care operator could be a great buy and hold investment due to Australia’s ageing population. Japara aims to meet the expected increase in demand for aged care services by significantly expanding the number of places it manages over the next few years. The company intends to add over 2,500 new places by 2025/26, which is an increase of 65% on its current places. I expect the increase in earnings this generates will put the company in a position to raise its dividend strongly in the future. At present its shares provide a trailing fully franked 5.5% dividend.

WAM Capital Limited (ASX: WAM)

There are a number of listed investment company’s on the ASX, but WAM Capital would have to be my favourite based on performance, yield, and value. I’ve been very impressed with the way its portfolios have outperformed the market by some distance over the last few years and expect to see more of the same in the future. Its shares are currently changing hands at 11x estimated forward earnings and provide investors with a trailing fully franked 6% dividend.

Finally, here's a fourth dividend share worth considering as an alternative to Westpac. I think its strong local business and growing international operations could put it in a great position to grow its dividend significantly over the next decade.

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Motley Fool contributor James Mickleboro owns shares of Westpac Banking Corp. The Motley Fool Australia owns shares of Dicker Data Limited. 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.

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