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Buy these ASX dividend shares in November

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There are a good number of dividend shares for investors to choose from on the Australian share market. Two that I think are among the best on offer are listed below.

Here’s why I think they would be top options for income investors in November:

Coles Group Ltd (ASX: COL)

The first ASX dividend share I would buy is Coles. I continue to believe that the supermarket giant is one of the best income options on the Australian share market. This is due to its defensive qualities, strong market position, and positive long term growth outlook. The latter is being underpinned by its refreshed strategy and long history of comparable store sales growth. In fact, in August, Coles reported its 51st consecutive quarter of Supermarkets comparable sales growth. I think this is a staggering record and demonstrates the quality of its business.

And while this incredible run is likely to come to an end next year when it cycles the third and fourth quarters of FY 2020, which saw sales spike from panic buying at the height of the pandemic, I expect it to resume its comparable store sales growth again soon after. In the meantime, based on the current Coles share price, I estimate that it offers a fully franked ~3.6% dividend yield in FY 2021.

Wesfarmers Ltd (ASX: WES)

Another ASX dividend share to consider buying is Coles’ former parent, Wesfarmers. I believe the conglomerate is well-positioned for growth over the coming years thanks to its high quality portfolio of assets. These include Bunnings, Kmart, Target, Officeworks, online retailer Catch, and a collection of industrial businesses. The key business for me is the Bunnings business, which I believe is well-placed for growth thanks to government home improvement stimulus and personal tax cuts. The latter should also be supportive for other retail businesses. 

Another reason I like Wesfarmers is its strong balance sheet and management’s history of making earnings accretive acquisitions. I suspect the company will be adding to its portfolio before the end of FY 2021 and boosting its future growth. For now, I expect it to pay a fully franked dividend of ~$1.50 per share in FY 2021. Based on the latest Wesfarmers share price, this equates to an attractive fully franked 3.2% dividend yield.

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Returns As of 6th October 2020

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of COLESGROUP DEF SET and Wesfarmers 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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