The Motley Fool

3 top shares with fast-growing dividends

Although the shares listed below don’t necessarily have the biggest dividend yields on the market, I believe that there is significant room for growth over the next decade that could make them dividend stars of the future.

Because of this, I think it could be worth considering a long-term buy and hold investment in them. Here’s why I like these shares:

Collins Foods Ltd (ASX: CKF)

Collins Foods is one of the largest franchisees of KFC restaurants and positioned well for long-term growth thanks to its expansion into an underpenetrated European market. While it is early days and I have yet to gauge how well its European businesses are performing, I’m optimistic that the tried and tested formula will work well in this market. If this proves to be the case, it could allow Collins Foods to achieve above-average earnings and dividend growth for many years to come. Collins Foods’ shares offer investors a trailing fully franked 3.1% dividend at present.

Helloworld Travel Ltd (ASX: HLO)

There are several quality options in the travel sector, but one of my favourites would have to be Helloworld. I thought its first-half result was amongst the best on the market when it delivered a 39.2% increase in net profit before tax to $26 million. This strong result was driven largely by the growing demand for its integrated service offering. With tourism into and out of Australia continuing to grow strongly, I believe Helloworld Travel can continue to deliver solid profit and dividend growth for the foreseeable future. At present Helloworld’s shares offer a trailing fully franked 3.2% dividend.

Macquarie Telecom Group Ltd (ASX: MAQ)

While Macquarie Telecom’s shares may only offer investors a trailing fully franked 2.5% dividend currently, I believe the cloud computing boom could put the telco company in a position to grow its dividend strongly over the coming years. Its Cloud Services segment delivered a 30% increase in half-year net profit in February, making it the company’s biggest segment now. With the cloud boom showing no signs of slowing, I expect more of the same in the second-half and beyond.

5 stocks under $5

We hear it over and over from investors, "I wish I had bought Altium or Afterpay when they were first recommended by The Motley Fool. I'd be sitting on a gold mine!" And it's true.

And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!

*Extreme Opportunities returns as of June 5th 2020

Motley Fool contributor James Mickleboro owns shares of Collins Foods Limited. The Motley Fool Australia owns shares of Helloworld 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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