Luckily in this low interest environment, the Australian share market is home to a large number of shares offering generous dividend yields.
Whilst there are a lot of quality options to choose from, three of my favourites are listed below. Here's why I like them:
Macquarie Group Ltd (ASX: MQG)
The big four banks may be out of favour with investors right now, but I wouldn't let that put you off investing in Macquarie. I think it would be a great alternative to the big four and a top long term option for income investors. This is largely because of the quality and diversity of its operations. Overall, I believe this leaves Macquarie well-positioned for growth over the next decade. At present Macquarie's shares offer a partially franked trailing dividend yield of approximately 4.4%.
Sydney Airport Holdings Pty Ltd (ASX: SYD)
One of my favourite dividend shares is Sydney Airport. I'm a big fan of the airport operator because of its strong market position and pricing power. Over the years this has allowed Sydney Airport to grow its dividend consistently, much to the delight of its shareholders. Pleasingly, I believe it is well-placed to continue this positive trend for some time to come thanks to increasing international tourism and improving domestic tourism trends. At present Sydney Airport's shares offer a trailing 4.2% dividend yield.
Telstra Corporation Ltd (ASX: TLS)
I think Telstra would be a good option for income investors, especially given its investor update this week. That update revealed that the telco giant's T22 strategy is progressing well and it remains on course to strip out a total of $2.5 billion in costs. It also confirmed that Telstra is on track to deliver on its EBITDA and free cash flow guidance in FY 2020. I believe the latter means that the company's 16 cents per share fully franked dividend is safe and no further dividend cuts will be necessary. Based on this, I estimate that its shares currently offer a 4.1% dividend yield at present.
