Buying ASX shares for growth is a great strategy for building wealth. As is buying ASX shares for dividend income. But I think a better way to pick stocks is by aiming for both and getting the benefits of both worlds.
After all, if your shares are growing in value while also paying you a rising stream of income, the compounding effect on your portfolio will be amplified enormously.
So, here are two ASX shares that I think have the potential to fill such a prescription.
Wesfarmers Ltd (ASX: WES)
Wesfarmers is one of the largest companies in Australia and on the ASX (with a market cap of $51.36 billion). That doesn't mean this company has run out of puff though! The Wesfarmers share price has climbed over 35% in the last year and is currently near record highs.
The company has made some savvy moves lately, spinning off 85% of Coles Group Ltd (ASX: COL) in 2018 and picking up lithium producer Kidman Resources last year – which I think will continue to fuel growth for years to come.
But today, Wesfarmers also offers a hefty dividend of 3.91% (or 5.59% grossed-up) on current prices. Whilst that's not quite as substantial as an ASX bank like Commonwealth Bank of Australia (ASX: CBA), it's still a decent return on your capital.
All in all, I think investors can expect both reasonable growth and income from Wesfarmers shares today.
WAM Global Ltd (ASX: WGB)
WAM Global isn't really a conventional company, rather a Listed Investment Company (LIC) that invests in other companies on behalf of its shareholders. In WAM Global's case, it scours the whole world for investment opportunities, not just the ASX.
Some of its largest holdings are US-based American Express and the Japanese Kobe Bussan. Since its inception in 2018, the LIC has delivered a respectable 10.2% per annum in performance, which I'm confident will continue to accelerate over time.
In addition, WAM Global has recently started paying a dividend, which has already increased 50% from its inaugural payment to its second. Over time, I think this dividend will rise to a market-leading level in line with WAM Global's Australian counterpart WAM Capital Ltd (ASX: WAM).
Thus, I also think WAM Global is a top ASX stock for both growth and income today.
Foolish takeaway
Finding shares that can consistently deliver both growth and income is rare, but I think these two ASX shares today are prime candidates.
Wesfarmers and WAM Global have solid track records of both and I don't see anything in their path that would prevent this from continuing well into the future.
