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Why I would buy these dividend shares in April

The Australian share market has now closed for Easter and will return to trade on the Tuesday, the same day as the next Reserve Bank of Australia’s cash rate meeting.

That meeting is almost certainly going to end up with the same result as the last 17 meetings, making it a record 18th consecutive meeting that rates have stayed on hold at the record low of 1.5%.

This will be great news for borrowers, but not for savers.

The good news for the latter group, though, is that the share market is home to a great number of shares offering dividend yields that are vastly superior to savings accounts.

Two which I think are worth considering in April are listed below:

Telstra Corporation Ltd (ASX: TLS)

This telco giant’s share price has come under pressure over the last 12 months and recently fell to a multi-year low. Concerns over its future profitability and of course its decision to cut its dividend have been the catalyst for this decline. I’m a little more upbeat on the company’s prospects and expect market sentiment will soon become positive. Especially if the Federal Government decides to write down the value of the NBN, leading to higher margins for providers like Telstra. I think this would make its 22 cents per share dividend secure for the foreseeable future. At the current share price this equates to a fully franked 7% yield.

WAM Capital Limited (ASX: WAM)

WAM Capital is a listed investment company which over the last decade has impressed me with the great track record of both its funds and the growth of its dividend. Last month the company’s strong performance in the first-half of FY 2018 allowed it to lift its interim dividend by 3.3% to 7.75 cents per share. This puts it on course to make it nine years in a row of dividend increases this year. Based on its last close price, its shares provide investors with a trailing fully franked 6.1% dividend.

This third dividend share may not have as big a yield as Telstra or WAM Capital, but it is growing at a rapid pace.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra 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 Scott Phillips.

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