There are some ASX dividend shares that might be worth looking into for income.
Businesses that are paying dividend yields that are much higher than what investors might be able to get out of a bank account might seem attractive.
These two could be interesting ideas for income:
Centuria Industrial REIT (ASX: CIP)
This real estate investment trust (REIT) is Australia’s largest domestic pure play industrial option.
It’s currently rated as a buy by the broker Morgan Stanley with a price target of $3.77.
Centuria Industrial REIT now has a portfolio of 61 investment properties worth more than $2.6 billion with a weighted average capitalisation rate (WACR) of 4.95%, an occupancy rate of 98.8% and an overall weighted average lease expiry (WALE) of 9.7 years as at 31 March 2021.
One example of the type of tenant that the ASX dividend share has is Woolworths Group Ltd (ASX: WOW) which is leasing the Warnervale Distribution Centre in NSW. It recently doubled this lease to 10.2 years. The ASX dividend share said that this demonstrated tenant demand for strategic food logistics assets.
Centuria Industrial REIT fund manager Jesse Curtis said:
We are seeing growing market demand for leasing of food logistics assets reflecting increasing consumer demand for fresh food and rise of food-related e-commerce. This is a structural trend we identified when we took over management of CIP in 2017 and have since focused on leveraging in this area, by adding strategic food-related assets to our portfolio and securing long-term leases with blue chip tenants.
Our Warnervale lease extension is a testament to this strategy. It builds on CIP’s acquisition of $214 million worth of cold storage assets and $236 million of food manufacturing facilities since FY19 – all of which are delivering significant value and attractive returns for CIP unitholders.
Morgan Stanley thinks that Centuria Industrial REIT will pay a FY21 distribution of 17 cents per unit, translating to a yield of 4.9% from the ASX dividend share.
Accent Group Ltd (ASX: AX1)
Accent is a large Australian retailer of shoes. It sells a number of different brands including CAT, Dr Martens, Platypus, Skechers, Vans, Timberland and The Athlete’s Foot. The Glue Store is the latest business to be added to the portfolio.
The business is heavily focused on growing its store network – where it is seeing solid same store sales growth – as well as its digital presence. Online shopping is booming and Accent Group is taking advantage of that. The HY21 result saw digital sales grow 110% to $108.1 million, representing 22.3% of sales.
HOKA ONE ONE is one of the latest brands that Accent has been appointed to be the exclusive distributor in Australia for an initial 3-year term. Accent said that it’s one of the fastest growing performance brands globally.
In the first eight weeks of the second half of FY21, the ASX dividend share’s like for like retail sales were up 10.7% and digital sales were above 65.4%.
It has a goal of at least 10% compound earnings per share (EPS) growth. Citi has a price target on Accent of $3.10 and thinks the FY21 grossed-up dividend yield will amount to 6.5%.