The Motley Fool

Why I would buy Coles and these ASX dividend shares

With interest rates at ultra-low levels and tipped to keep on falling, it is getting harder and harder for retirees to generate a sufficient income from traditional interest-bearing products.

The good news is that the Australian share market is here to the rescue with a large number of dividend shares offering very generous yields.

Three to consider buying this month are listed below:

Coles Group Ltd (ASX: COL)

One of my favourite buy and hold options on the Australian market is Coles. I believe the supermarket operator is well-placed for solid growth over the next decade thanks to its refreshed strategy. One of the key aims of this strategy is stripping out upwards of $1 billion in costs over the coming years. I believe this bodes well for its earnings and ultimately its dividends. I estimate that its shares currently provide a fully franked forward 3.5% dividend. But this could grow materially in the future.

Scentre Group (ASX: SCG)

Another top dividend share to consider is Scentre Group. It is the owner and operator of Westfield properties in the ANZ region. Thanks to robust demand for its tenancies and the increasing number of consumers that visit its centres, I believe it is capable of growing its distribution at a solid rate in the future. At present Scentre Group’s units offer income investors a trailing 5.7% distribution yield.

Transurban Group (ASX: TCL)

And finally, I feel Transurban would be a great option for income investors this month. Transurban is a leading toll road operator that owns and operates a number of important roads in Australia and North America. Thanks to increasing traffic, periodic toll price increases, and developments and acquisitions, I expect Transurban to continue growing its distribution for a long time to come. Based on its guidance for FY 2020, its shares currently offer a forward 4.15% forward yield.

And here are more dividend shares that I think income investors ought to consider buying this month. Each is growing their dividend at a solid rate.

NEW! Top 3 Dividend Bets for 2020

With interest rates likely to stay at rock bottom for months (or YEARS) to come, income-minded investors have nowhere to turn... except dividend shares. That’s why The Motley Fool’s top analysts have just prepared a brand-new report, laying out their top 3 dividend bets for 2019.

Hint: These are 3 shares you’ve probably never come across before.

They’re not the banks. Not Woolies or Wesfarmers or any of the “usual suspects.”

We think these 3 shares offer solid growth prospects over the next 12 months. Each of these three companies boasts fully franked yields and could be a great fit for your diversified portfolio. You’ll discover all three names and codes in "The Motley Fool’s Top 3 Dividend Shares for 2019."

Even better, your copy is free when you click the link below. Fair warning: This report is brand new and may not be available forever. Click the link below to be among the first investors to get access to this timely, important new research!

The names of these top 3 dividend bets are all included. But you will have to hurry. Depending on demand – and how quickly the share prices of these companies move – we may be forced to remove this report.

Click here to claim your free copy right now!

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Transurban Group. The Motley Fool Australia has recommended Scentre Group. 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.

NEW. Five Cheap and Good Stocks to Buy in 2019…

Our Motley Fool experts have just released a brand new FREE report, detailing 5 dirt cheap shares that you can buy today.

One stock is an Australian internet darling with a rock solid reputation and an exciting new business line that promises years (or even decades) of growth… while trading at an ultra-low price…

Another is a diversified conglomerate trading near a 52-week low all while offering a 2.8% fully franked yield…

Plus 3 more cheap bets that could position you to profit over the next 12 months!

See for yourself now. Simply click the link below to scoop up your FREE copy and discover all 5 shares. But you will want to hurry – this free report is available for a brief time only.

CLICK HERE FOR YOUR FREE REPORT!