Unfortunately, because of the pandemic, a number of popular dividend shares have been forced to defer or cancel their dividends.
The good news is that there are still a handful of companies out there that appear well-positioned to pay their dividends as normal.
Two safe ASX dividend shares that I believe will pay generous dividends are listed below. Here's why they could be good options for income investors right now:
Coles Group Ltd (ASX: COL)
One of the safest dividend shares I think you could buy today is Coles. During the pandemic the supermarket giant has experienced a surge in sales from panic buying and more eating at home. And while increased operating costs will mean that not all of this sales growth flows to the bottom line, I'm confident Coles will deliver a solid increase in full year earnings and ultimately its dividend. I expect this positive form to continue in FY 2021 and for Coles to be in a position to pay another generous dividend. Based on this and the current Coles share price, I estimate that it offers investors a fully franked FY 2021 dividend yield of ~3.5%.
Wesfarmers Ltd (ASX: WES)
Another safe dividend share to consider buying for income is Coles' former parent, Wesfarmers. I think the conglomerate is a great option due to the quality and positive outlook of its diverse portfolio of businesses. Another positive is that Wesfarmers has a sizeable cash balance, especially after the selldown of its Coles stake earlier this year. I believe these funds are likely to be used for acquisitions in the near future. And given management's track record of successful investments, these could give its earnings and dividend growth a real boost in the coming years. For now, though, based on the current Wesfarmers share price, I estimate that it offers a fully franked forward 3.3% dividend yield.
