2 bargain Australian shares with dividend yields higher than 6%

Looking for a bargain but can't give up on dividend payments?

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In today's volatile market, finding reliable dividend-paying stocks can provide much-needed stability and consistent income for investors. However, identifying such ASX dividend stocks can often feel like searching for hidden gems amidst the market noise and uncertainty.

The following two ASX dividend shares might be worth consideration today if you're a dividend-focused investor.

APA Group (ASX: APA)

APA Group is Australia's leading energy infrastructure business, owning and operating natural gas transportation assets. With a vast network of pipelines spanning the country, APA plays a crucial role in delivering energy to homes and businesses.

APA Group shares currently offer a dividend yield of 6% using actual payments over the last 12 months. The good news is that the company guided for FY24 dividends per share (DPS) of 56 cents, implying a 7% dividend yield at the current share price.

Macquarie anticipates APA Group's attractive dividends will continue in FY25. The broker projects FY25 DPS of 57.5 cents, slightly higher than FY24 DPS, as my colleague James highlighted.

This attractive yield is backed by stable cash flows generated from its long-term contracts with major energy producers and consumers.

Investing in APA Group provides exposure to Australia's essential energy infrastructure sector. With a reliable dividend yield and strategic growth initiatives, APA can be a compelling choice for income-seeking investors looking for stability and potential capital appreciation.

The APA Group share price has fallen 20% over the past year and closed Friday trading at $7.91.

Rural Funds Group (ASX: RFF)

Rural Funds Group is a leading agricultural real estate investment trust (REIT) in Australia, owning a diversified portfolio of agricultural assets. These include vineyards, cattle farms, water assets, and almond orchards spread across various regions.

Currently, Rural Funds Group offers investors an attractive dividend yield of around 6%. The REIT's business model focuses on long-term leasing arrangements with agricultural tenants, providing predictable and sustainable cash flows.

Amid global demand for agricultural products, Rural Funds Group stands to benefit from stable rental income and potential capital appreciation of its agricultural properties. The REIT's diversified portfolio mitigates risks associated with any single agricultural sector.

Following a recent dip in its unit price, Rural Funds Group is now trading below its book value. Its current price-to-book (P/B) ratio stands at 0.72x based on reported figures, which include water entitlements at their book values. When adjusting for the estimated market value of these water entitlements, the company estimates its net asset value (NAV) to be $3.07 per unit as of December 31, 2023. This adjustment lowers its P/B ratio even further to 0.66x.

Investing in Rural Funds Group offers exposure to Australia's resilient agricultural sector with the added benefit of consistent dividend income. The REIT's strategic portfolio management and focus on long-term leases ensure reliable returns for investors seeking income and stability.

The Rural Funds Group share price rose 6.6% over the past year and closed Friday at $2.01.

Motley Fool contributor Kate Lee has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Apa Group and Rural Funds Group. 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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