Although the Reserve Bank of Australia elected to keep the cash rate on hold at 1% on Tuesday, I don’t believe it will be long until the central bank takes rates lower.
This is great news for borrowers but not so positive for savers who will have to contend with lower and lower interest rates over the next 12 months.
But don’t worry because these top dividend shares can help you smash low interest rates:
Accent Group Ltd (ASX: AX1)
I think that this footwear-focused retailer would be a good option for income investors. Last month it released its full year results and delivered an 8.7% increase in total sales to $935.3 million and a 22.2% jump in statutory net profit after tax to a record of $53.9 million. Strong like for like sales growth and margin improvement from reduced discounting were behind the impressive profit growth. I expect more of the same in FY 2020, which should put the company in a position to grow its dividend further. At present its shares offer a trailing fully franked 5.15% dividend yield.
Aventus Group (ASX: AVN)
Another solid performer in FY 2019 was this owner and operator of large format retail parks across Australia. Last month it delivered funds from operations (FFO) of $96 million or 18.4 cents per security, up from $89 million and 18.1 cents per security in the prior corresponding period. As a result of this strong form, Aventus declared distributions of 16.6 cents per security for the year. Pleasingly, management is positive on its outlook and expects FFO per security growth of 3% to 4% in FY 2020. Based on this, I estimate that its shares offer a 6.4% forward distribution yield.
Lendlease Group (ASX: LLC)
Although this international property and infrastructure company was a very disappointing performer in FY 2019, I believe the company is over the worst of its issues now and expect it to return to growth in FY 2020. Especially given its decision to sell its troubled engineering division and management revealing that it has a record pipeline of development projects. And looking further ahead, the company’s ~$20 billion multi-year project with tech giant Google looks set to underpin solid earnings and dividend growth over the next decade. At present I estimate that its shares offer a fully franked 4% FY 2020 dividend yield.
As well as Lendlease, here are more dividend shares that look well-positioned to grow their dividends at a quick rate over the coming years.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Accent Group and AVENTUS RE UNIT. 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.