Whilst I'm a fan of big dividend yields like those on offer from Telstra Corporation Ltd (ASX: TLS) and Wesfarmers Ltd (ASX: WES), I think dividends which have the potential to grow significantly in the future are even better.
Two shares which I think are capable of doing this are listed below. Here's why they could be worth a look:
Australian Pharmaceutical Industries Ltd (ASX: API)
While I think this pharmacy chain operator and distributor is a great option for income investors today, investors may want to hold fire until the release of its full-year results later this week.
The company behind the Priceline pharmacy chain is widely expected to increase its full-year dividend by approximately 25% to 7.5 cents per share. This equates to a fully franked 4.8% yield based on the last close price. I believe that this yield would be too hard to say no to if trading conditions have improved and management provides positive FY 2018 guidance.
BT Investment Management Ltd (ASX: BTT)
I've been very impressed at the way BTIM has continued to experience strong fund inflows despite the Brexit. As of September 30, the fund manager had $94.4 billion in funds under management. This is up over 18% from the $79.7 billion it had under management on June 30 2016, seven days after the Brexit vote.
If it can continue this trend then I believe it will be in a great position to continue growing its dividend. At present BTIM provides a partially franked 3.7% dividend, having grown it by an average of 21% per annum over the last five years.
