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:
Crown Resorts Ltd (ASX: CWN)
Crown Resorts has a grossed-up dividend yield of just under 6%.
The casino operator receives a good level of regular customers into its casinos, hotels and other entertainment venues at its Melbourne and Perth casino complexes.
This fairly consistent level of cashflow allows Crown to pay a dependable dividend of $0.60 per share.
Crown’s future dividends could increase once Crown Sydney is complete and operational in a couple of years.
Super Retail Group Ltd (ASX: SUL)
Super Retail has a grossed-up dividend yield of 7.4%.
The business has a number of retail brands that continue to grow despite the tough Australian retail conditions, which shows they’re good quality and worth holding if you want some retail dividend exposure.
Supercheap Auto, Rebel, BCF and Macpac all grew like for like (LFL) sales faster than inflation in FY19, with total LFL sales increasing by 2.9%. This helped boost normalised net profit by 5%. FY20 LFL sales growth has continued.
New Hope Corporation Limited (ASX: NHC)
New Hope offers a grossed-up dividend yield of 10.8%.
The coal miner has increased its dividend each year since 2016, but it is quite dependent on what the coal price is doing. Coal is currently down, which is why the New Hope share price is down, however in theory it’s best to buy resource shares when the cycle has turned against the company.
I’m not sure what the long-term coal price will do, but demand for coal is expected to rise over the next decade or two with Asian countries looking for secure energy.
At the current prices I’d probably personally go for Crown Resorts. It offers something quite different to nearly all other shares on the ASX and Crown Sydney could give earnings a material boost in the next few years.
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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Crown Resorts 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.