With the cash rate at a record low and the Reserve Bank of Australia unlikely to lift it for some time, I think investors should consider skipping savings accounts and term deposits in favour of the many quality dividend shares on offer on the local share market.
Three dividend shares that I think could be great options in 2019 are listed below. Here’s why I like them:
Australia and New Zealand Banking Group (ASX: ANZ)
My favourite Australian bank to buy at the moment is ANZ Bank. I believe it is the best-positioned bank to deliver earnings growth in FY 2019 due to its overweight exposure to the business lending market which is performing well. So with its shares still trading on lower than average multiples and offering a trailing fully franked 6% yield, I think it is well worth considering right now.
Dicker Data Ltd (ASX: DDR)
Another top option for income investors in 2019 could be this computer software and hardware distributor. In the first half of FY 2018 Dicker Data posted revenue growth of 13.5% and a 24.9% increase in net profit after tax. This puts the company in a strong position to deliver on its plans to increase its dividend to a fully franked 18 cents per share this year. If it does increase its dividend to this level it will mean its shares offer a 6.3% yield today.
Super Retail Group Ltd (ASX: SUL)
With its shares trading at just 9x earnings and offering a trailing fully franked 7.1% dividend, I think the retail group behind brands including Rebel and Macpac could be worth considering right now. Although there are concerns that it may have struggled during the Christmas trading period, I feel that this potential underperformance has already been priced in. In light of this, I think its shares offer a compelling risk/reward for income investors.
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Returns As of 6th October 2020
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Dicker Data Limited. The Motley Fool Australia owns shares of Super Retail Group 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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