3 ASX dividend shares rated as buys by brokers

Here are 3 ASX dividend shares that brokers have rated as buys.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

It can be an interesting insight to know what brokers think of an ASX dividend share. The problem is that a single broker can be wrong or biased.

If you can get a consensus among brokers about which shares are best, then that may give a clue about what to buy and what to avoid.

Every so often MarketIndex collates the broker recommendations of 450 ASX shares and totals the buys, holds and sells for those shares. The higher or lower the average score the more of a strong buy, buy, hold, sell or strong sell that share is.

The below ideas have dividend yields above 5% and a market capitalisation above $1 billion. However, a high dividend yield can indicate a falling share price or limited growth prospects.

Here are three of the ASX dividend shares that fit the bill:

Whitehaven Coal Ltd (ASX: WHC)

Whitehaven Coal was the only share on the list rated as a strong buy. As the name might suggest, it's a coal business. It describes itself as the leading coal producer in NSW's Gunnedah Basin.

The recent strength of the coal price thanks to demand in Asia and record profits from Whitehaven has led to the miner being a surprisingly good dividend share over the past couple of years. Not only have the dividends been flowing but net debt reduced in the recent result as well.

Based on the last 12 months of dividends, including special dividends, Whitehaven currently has a trailing dividend of 11%. Excluding special dividends, the yield is 6.8%.

Viva Energy Reit Ltd (ASX: VVR)

As the name might suggest, it's a real estate investment trust (REIT) that owns over 400 service station sites which it leases to Viva Energy Group Ltd (ASX: VEA), which we see on the roads as Coles Express locations.

With an 100% occupancy rate, a weighted average lease expiry rate (WALE) of over 12 years and 3% per annum rent increases built in it's easy to see why this REIT could be a solid income performer for the next several years. Additional acquisitions can also boost earnings over time.

It currently has a distribution yield of 5.8%.

Boral Limited (ASX: BLD)

Boral is the country's largest building and construction materials business. Worries about the state of the Australian construction market has sent the Boral share price down in recent months, but the dividend continues to grow each result.

The December 2018 report saw a 4% increase of the dividend to 13 cents per share. Its trailing partially franked dividend is 5.4%.

Foolish takeaway

I can see why each of these businesses are ideas as buys for both the share price and the dividend, but I don't like the idea of investing in a coal business or Boral. Viva Energy REIT seems to offer a solid dependable yield but I think there are better options.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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.

More on ⏸️ Dividend Shares

A boy hold money and dressed in business suit next to money bags on a desk, indicating a dividends windfall
⏸️ Dividend Shares

The Accent (ASX:AX1) dividend has lifted by 22%

The company will reward shareholders with an increased dividend...

Read more »

a woman sits in the driver's seat of a car with her arm resting on the door with a small smile on her face, looking out of the car.
⏸️ Dividend Shares

Carsales (ASX:CAR) share price records a modest rise on dividend slash

Australia's largest online automotive and marine classifieds business notches a conservative share price rise on its latest report.

Read more »

A young entrepreneur boy catching money at his desk, indicating growth in the ASX share price or dividends
Bank Shares

ASX 200 bank shares to follow suit after CBA dividend hike: expert

Dividend investors rejoice! This expert expects more dividends to come from ASX 200 bank shares...

Read more »

sad looking petroleum worker standing next to oil drill
Share Fallers

AGL (ASX:AGL) dividend slashed. Share price down 3% on Thursday

More headwinds for the energy giant as its dividend is now in the spotlight.

Read more »

A girl looks through a microscope at money.
⏸️ Dividend Shares

The ANZ (ASX:ANZ) share price has only gained 10% in 5 years. But have the dividends paid off?

We do the math to see if it has been worth investing in ANZ shares over the long term...

Read more »

man laying on his couch with bundles of money and extremely ecstatic about high dividend returns
⏸️ Dividend Shares

The NAB (ASX:NAB) share price is flat 5 years on. But have the dividends paid off?

We calculate if it has been worth investing in NAB shares over the long run...

Read more »

two children dressed in business attire with joyous, wide-mouthed expressions count money at a desk covered in cash and sacks of money either side.
⏸️ Dividend Shares

Top-10 ASX dividend share delivers market-thumping share price gains

The Holy Grail for income stocks is to return strong capital gains as well

Read more »

happy woman looking at her laptop with notes of money coming out representing financial success and a rising share price and dividend yield
⏸️ Dividend Shares

Mining shares in the ASX 200 might unearth US$26b worth of dividends

Are shareholders about to dig some dividends?

Read more »