Like moths to a flame, investors are currently finding ASX dividend shares very alluring.
The volatile share market this year has forced many to turn to income-producing ASX shares as protection against slowing capital growth.
But Celeste Funds executive chair Paul Biddle told the Australian Financial Review to be wary of false idols.
"There are [a] lot of yield traps out there," he said.
"You need to know that the small-cap company has a reasonable chance of making its revenue and earnings forecast, even if the economy slows."
The businesses to look for are those with "a good handle on its cost base".
That means they can forward any supply cost pressures to customers, maintain margins, and eventually pay a healthy dividend.
Blackmore Capital chief investment officer Marcus Bogdan believes he's found one such dividend stock:
No shortage of customers
Industrial real estate provider Goodman Group (ASX: GMG) last week released a performance update that was well-received.
But that hasn't stopped the market punishing the Goodman share price down 16.4% over the past month and more than 28% for the year so far.
That just makes it attractive to Bogdan's team though.
"Yeah, we like Goodman," he told Switzer TV Investing.
"Unlike the broad spectrum of property stocks that are listed, there's been a significant sell-off of between 20% and 25%. And now we're starting to see some value."
He likes the ongoing demand for Goodman's distribution centres and logistics, which matches what modern e-commerce businesses need around the world.
"That's been reflected in an upgrade in their earnings," said Bogdan.
"At the beginning of this financial year they forecast earnings were going to grow 10%. They upgraded that to 20%, then earlier this week they've increased that again to earnings per share growth of 23%."
The Motley Fool's James Mickelboro reported Goodman clients are continuing to "intensify warehousing in urban locations" and "increase automation and technology".
"All in all, this has underpinned a 3.7% increase in like-for-like net property income and a 98.7% occupancy rate."
Despite this year's sell-off, Goodman shares have risen in excess of 123% over the past five years, and pay out a 1.1% dividend yield.
