We have to search hard for reliable dividend shares to boost our income at the moment.
Low interest rates have pushed up valuations and pushed down yields. But I think there are several ASX shares that have yields above 5% that could offer reliable income:
Growthpoint Properties Australia Ltd (ASX: GOZ)
Growthpoint is a real estate investment trust (REIT) with around two thirds of the portfolio being office buildings and the other third being industrial properties. Some of its top tenants include Woolworths Group Ltd (ASX: WOW), NSW Police and Commonwealth Bank of Australia (ASX: CBA).
It has some attractive factors for a REIT, it has a projected FY20 yield of 5.3%, an occupancy rate of 98%, internalised management and a weighted average lease expiry (WALE) of 4.9 years.
Growthpoint has increased its distribution each year since the GFC, so it actually has one of the better records on the ASX.
WAM Research Limited (ASX: WAX)
WAM Research is one of the best listed investment companies (LICs) on the ASX. The job of a LIC is to generate investment returns for investors.
Over the past decade it has been one of the best-performing LICs by focusing on small and medium ASX growth shares that look undervalued. Between July 2010 and December 2019 its investment portfolio generated returns of 16.2% per annum before fees, expenses and tax.
LICs can turn some (or all) of their net investment returns into dividends for investors. That’s exactly what WAM Research has done, it has grown its dividend every year since the GFC.
It currently has a grossed-up dividend yield of 9.4%.
Viva Energy Reit Ltd (ASX: VVR)
This is another REIT. The great thing about REITs is that because of monthly rental income they can deliver consistent (growing) distributions to investors.
It currently owns over 450 service stations across in Australia, mainly in metropolitan areas. There is a fixed 3% rental escalation with 95% of its properties and it has a WALE of around 12 years, which means it has attractive rental growth locked in for over a decade.
The REIT continues to make acquisitions which can further boost the income potential.
It currently has a distribution yield of 5.3%.
Each of them have attractive distribution growth prospects. I think Viva Energy REIT has the best chance of providing a reliable distribution, but I think I’d prefer to go for WAM Research for its higher yield and wider investment flexibility.
Where to invest $1,000 right now
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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.