I believe now to be a fantastic time to look for great ASX dividend-paying shares to add to your portfolio. With most share prices currently still significantly lower compared to the start of the year, finding shares that are still likely to pay or even grow their dividend payments are even more attractive today.
So, are you looking for a few great dividend investments and have a spare $1,000 to invest in each? Below are 3 ASX shares I believe are attractively priced and paying a strong yield.
Tassal Group Limited (ASX: TGR)
Tassal group recently announced that it is favourably viewing changing market trends brought on by the coronavirus. Australia’s largest salmon farmer believes a trend towards healthy eating, home cooking and food traceability to be a positive for Tassal’s outlook. It has also noted that overall market dynamics for salmon are remaining positive, with further investment in both salmon and prawn operations to continue in order to drive long-term growth.
Tassal is on track to grow its second-half harvest and sales after announcing a new strategy. This strategy is to hold and grow fish longer, with larger fish generating larger margins.
For these reasons, I think Tassal currently offers an exciting dividend future. Coupled with its lower share price today, I believe it provides an attractive entry point and offers investors a grossed-up 5.3% trailing dividend yield.
WAM Global Ltd (ASX: WGB)
WAM Global is a listed investment company (LIC) from Wilson Asset Management. It targets compelling undervalued growth companies from outside of Australia.
Its last investor update in March noted close to 60% of its holdings were in the US and that it had a portfolio cash weighting of 19.5%. This cash weighting is up from 10.5% in the month prior, consequently making it look like management has been increasing its cash holding to be able to take advantage of beaten-down asset prices. Time will tell.
I like WAM Global for its diversified exposure outside of Australia. Being a LIC, it also has additional control in its dividend payments with an ability to ‘smooth’ payments even as profits fluctuate.
WAM Global’s most recent dividend of 3 cents per share was an increase of 50% over its prior payment. This gives it an annualised grossed-up dividend yield of 4.46%.
Dicker Data Ltd (ASX: DDR)
Dicker Data is a distributor of computer hardware, software and cloud solutions. Recently, it has been performing strongly thanks to the growth in employees working from home.
In fact, March was reported as its strongest month to date and saw the company plan to grow its dividend by 31% in FY2020. Of course, the Dicker Data share price jumped at the news, but that doesn’t mean it’s too late for income-orientated investors to get excited.
Dicker Data offers investors a grossed-up, forward dividend yield of 7.12%, which it pays out quarterly via 3 interim and 1 larger final dividend. It also has a company policy to pay out 100% of after-tax profits to shareholders. This equates to increasing dividends if management can continue its strong performance in profit growth.
On this note, I believe the coronavirus may have acted as a catalyst for employers. As they begin realise some of the benefits from remote working, I believe demand for Dicker Data’s products can continue to grow from here.
Additionally, despite the recent strong performance, Dicker Data announced a capital raising this week. The proceeds will be used to provide balance sheet flexibility and support long-term growth objectives. In contrast to the many ASX shares currently raising capital at beaten-down share prices, Dicker Data’s share price has been performing well recently, with capital being raised at $6.70 per share.
Using this capital to support long-term growth, Dicker Data should be able to continue growing profits, with dividend growth following suit.
Where to invest $1,000 right now
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Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of June 30th
Motley Fool contributor Michael Tonon owns shares of Tassal Group Limited and WAMGLOBAL FPO. The Motley Fool Australia owns shares of and has recommended Dicker Data 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.
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