It's during times like these that investors can find opportunities that are more likely to produce strong returns. The lower the price we pay for a good business, the stronger the return can be.

For example, a great business may be able to grow its share price from $10 to $20 over a five-year period – a return of 100%. But, if it fell to $8 (a 20% drop from $10) during that five-year period, the rise to $20 would be a gain of 150% (in a shorter timeframe) if someone managed to buy at $8.

Let's look at two businesses that have compelling futures and look good value today.

Guzman Y Gomez Ltd (ASX: GYG)

Guzman Y Gomez is a Mexican food business with restaurants in Australia, Singapore, Japan and the US.

At the end of the FY26 half-year period, the business had 237 locations in Australia (with 87 of those being company-owned and 150 being franchised). It also had 27 franchise locations in Asia (22 in Singapore and five in Japan), as well as eight company-owned locations in the US.

The ASX share is looking to grow to 1,000 Guzman Y Gomez locations in Australia over the next two decades, which would mean a quadrupling of its current network.

Network sales are growing rapidly in Australia, which I think is a great sign of how the company's financials could progress in the coming years because of how popular it is with consumers.

In HY26, Australian total network sales jumped 17.4% to $632.1 million and the Asian network sales increased 19.25% year-over-year.

While the US segment is currently struggling with profitability, the ongoing scaling of the business can help with certain profit measures. In HY26, US network sales jumped 67% to $8.2 million, while general and administrative expenses as a percentage of network sales improved from 78.1% in HY25 to 48.2% to HY26.

Despite investment in growth in the US, Guzman Y Gomez is seeing pleasing growth of its profit levels. Overall operating profit (EBITDA) grew by 29.6% to $40.9 million and net profit rose 44.9% to $10.6 million.

The ASX share is demonstrating operating leverage, strong double-digit revenue growth and it has big growth plans.

As long as the company's comparable sales growth remains solid, I think the business has very exciting prospects, particularly at this lower price – it's cheaper by around 25% in the year to date.   

Rivco Australia Ltd (ASX: RIV)

This business is a company that purely owns water entitlements in Australia and leases them out to agricultural operators on both long-term and short-term leases.

Rivco regularly agrees leases with farmers. For example, its February update included a 1,000 ML lease, taking its forward-committed position from 1 July 26 to around 66% of the portfolio.

The ASX share is seeing strong demand from irrigators and some dam storage levels have reduced.

In the long-term, I'm expecting water entitlement values to increase as a result of the Australian and global populations increasing, as well as more water-hungry crops being planted (such as almonds).

With the ASX share recently placing greater emphasis on paying a dividend based on its core operating earnings, I think it will be able to deliver stronger capital growth over the long term if it reinvests more of its capital gains in additional water entitlements or other shareholder-boosting initiatives, such as debt repayment or on-market share buybacks.

At February 2026, the ASX share reported a pre-tax net asset value (NAV) of $1.79 and post-tax NAV of $1.62. That means the current Rivco share price is at a discount of more than 10%, which looks appealing to me.

The post 2 top ASX shares to buy and hold for the next decade appeared first on The Motley Fool Australia.

Large declines don't happen without a reason. They are usually sparked because the market thinks the company's future earnings power is being reduced.

In this case, it seems that many investors believe future earnings may not be as strong as previously expected.

In this case, there are heightened fears that artificial intelligence (AI) may be able to challenge existing business models, particularly ones that utilise technology to deliver their service.

So, in this circumstance, it could be an idea to look at ASX defensive shares.

Why ASX defensive shares could make sense right now

If fast-growing businesses aren't expected to see as much profit generation, then perhaps it could be a good idea to look at names that could deliver reliable earnings. If profit can grow as expected, then this could help provide support for the share price and perhaps even enable a higher share price if investors are looking for a safe haven.

Additionally, some ASX defensive shares may be viewed as ideas for passive income. The stable earnings can also help provide stable and growing dividends from those sorts of businesses.

Which reliable businesses I'd look at

There are a few different areas of the market that I think could provide investors with underlying earnings stability over the long-term. Of course, there can be no guarantee share prices won't be volatile in the short-term – that is just what happens with the share market occasionally.

Real estate investment trusts (REITs) are a good sector because of how they can generate resilient defensive rental income and pay distributions to investors. I'd invest in businesses like Centuria Industrial REIT (ASX: CIP), Charter Hall Long WALE REIT (ASX: CLW) and Rural Funds Group (ASX: RFF).

Businesses involved in providing essential services to their customers could be useful ASX defensive share buys. I'm thinking of names like Telstra Group Ltd (ASX: TLS), APA Group (ASX: APA) and Propel Funeral Partners Ltd (ASX: PFP).

Defensive food businesses could be smart buys – we all need to eat. I'm thinking of names like Coles Group Ltd (ASX: COL) and Rivco Australia Ltd (ASX: RIV).

Finally, diversified businesses with defensive cash flow generation could also be smart long-term choices, such as Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) and Wesfarmers Ltd (ASX: WES).

I think most, if not all, of the above businesses are capable of growing their earnings over the long-term, even if AI affects the tech sector.

The post Is this the right time to invest in ASX defensive shares? appeared first on The Motley Fool Australia.

The biggest dividend yields aren't necessarily the only ones worth looking at, though one of the names I'll look at today does have a very high yield.

Businesses that reward investors with rising dividends are very appealing to me. The below are three with impressive dividend growth records.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts is the leader on the ASX that when it comes to dividend growth. The business has grown its annual regular dividend every year since 1998.

It has the smallest payout out of the three names in this article, with a grossed-up dividend yield of 3.9%, including franking credits.

But, I have the most confidence in this ASX dividend share growing its payout because of how it's funded by the cash flow of its investment portfolio.

It's invested in industries such as industrial properties, building products, resources, telecommunications, swimming schools and agriculture.

By generating profit from numerous sectors, it has diversified its risks and looked broadly for opportunities. This helps secure its future cash flow generation and dividend payments.

Rivco Australia Ltd (ASX: RIV)

Rivco owns a portfolio of permanent water entitlements based in south east Australia. The water can be leased to farmers on short-term or long-term leases, generating lease income for the company.

This ASX dividend share is a pleasing way to benefit from Australia's agricultural sector without some of the risks/volatility.

If water values increase over time, which I think they will, then the company can deliver capital growth too.

The business has increased its payout every six months since 2017, and currently has a grossed-up dividend yield of 6.9% (including franking credits).

Shaver Shop Group Ltd (ASX: SSG)

Shaver Shop sells a wide variety of male and female hair removal products from its store network of more than 120 locations.

The ASX dividend share has proven to have resilient sales during the last few years, showing consistent demand for its items. Hair doesn't stop growing, after all.

One of the most pleasing aspects of the ASX dividend share's business model is that it has made agreements with multiple shaver brands, unlocking exclusive products for consumers.

Impressively, the business grew its annual dividend per share each year between 2017 and 2023. It maintained the payout in 2024 and then increased the payout in 2025 to 10.3 cents per share.

At the current valuation, the FY25 payout translates into a grossed-up dividend yield of 9.4%, including franking credits. Growth is not guaranteed, but if it does increase the payout to 10.4 cents per share, it would represent a grossed-up dividend yield of 9.5%, including franking credits. That sounds like very pleasing passive income to me.

The post 3 great ASX dividend shares to buy in 2026 appeared first on The Motley Fool Australia.

Dividends aren't guaranteed in the same way interest from a term deposit is. But, some businesses have a more reliable dividend record than others.

If we just buy the most reliable names, then we can have greater confidence in the level of cash flow we think we're going to get. On the other hand, I wouldn't be confident about what dividends the miner Fortescue Ltd (ASX: FMG) may pay because of volatile iron ore prices.

I'll highlight two names I think offer very compelling payouts.

Rivco Australia Ltd (ASX: RIV)

This business is unique on the ASX – it owns water entitlements that it can lease to irrigators on short-term or long-term leases.

I like this ASX dividend share because it gives investors the ability to indirectly gain exposure to the important agricultural sector without having the operational risk of running farms.  

Pleasingly, the business can benefit from both the lease income and the potential long-term growth in the value of the entitlements.

Thanks to the decision of the company to pay a sustainable dividend, rather than the biggest it could, it has steadily grown its payout every six months since 2017.

The last two dividends declared by the business come to a grossed-up dividend yield of 7.3%, including franking credits.

The business is also trading at an attractive discount. The Rivco share price is currently at a 7.25% discount to the latest monthly net asset value (NAV) per share.

Rural Funds Group (ASX: RFF)

Rural Funds is another ASX dividend share that also gives investors exposure to the agricultural sector.

The real estate investment trust (REIT) owns a national portfolio of farms that are leased to high-quality tenants. Those farm types include cattle, vineyards, almonds, macadamias and cropping. I like that for the diversification it can add to my portfolio.

Prior to COVID-19, the business had an impressive record of growing its distribution by 4% per year. However, this was stopped by the high interest rate environment. Even so, the business has managed to maintain its annual payout each year since then.

It's expecting to pay an annual distribution of 11.73 cents per unit in FY26, translating into a forward distribution yield of 5.8%.

With rental increases built into most of its contracts (either fixed increases or linked to inflation), I think the prospects are positive for both rental profit growth and distribution growth in the longer-term.

It also looks like it's trading at a really good value. At 30 June 2025, it reported having a NAV of $3.08. That means it's currently trading at a 35% discount, which I'd call a really appealing level to buy at.

The post 2 ASX dividend shares I'd buy for reliable payouts appeared first on The Motley Fool Australia.

Dividend income is really appealing because of how little effort and further money we need to put in once we've made the investment. An investment property seems less appealing because of the possibility of various administrative tasks, repairs, tenants not paying and the (likely) debt that is necessary to buy the property.

The two ASX dividend shares I'm going to talk about below are two of the ones I'm confident can continue paying dividends and hopefully deliver larger payouts. Normally, I'd highlight Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) in an article like this, but there are other names I want to highlight.

Rivco Australia Ltd (ASX: RIV)

Rivco Australia, formerly called Duxton Water, owns a portfolio of water entitlements. Those can be leased on short-term or long-term leases.

The company can deliver earnings from both the lease income and the potential rise of water entitlement values.

This ASX dividend share has increased its payout every six months since 2017, which I'd describe as one of the more impressive growth streaks on the ASX. I love seeing dividends steadily rising over time, rather than trying to deliver maximum dividend income and risking a dividend reduction in future years.

The last two dividend payments by the business equate to a grossed-up dividend yield of 7.6%, including franking credits.

With a post-tax net asset value (NAV) of $1.58 and a pre-tax NAV of $1.75 as of November 2025, it's trading at an attractively cheap price, in my opinion.

Pinnacle Investment Management Group Ltd (ASX: PNI)

Pinnacle is one of the most appealing businesses in the funds management industry, in my opinion.

It has invested in a portfolio of funds management businesses such as Aikya, Antipodes, Coolabah, Firetrail, Five V, Hyperion, Langdon, Life Cycle, Metrics, Pacific Asset Management, Palisade, Plato, Resolution Capital, Solaris and Spheria.

Why do these fund managers want to sell a minority stake of their business to get Pinnacle on board? Pinnacle can provide a number of services including seed funds under management (FUM), distribution and client services, fund administration, compliance, finance, legal, technology and other administrative services.

Pinnacle is benefiting from the long-term organic capital growth of asset prices. Additionally, the fund managers have a collective record of delivering outperformance for their clients over the long-term, helping them retain FUM and attract new funds.

The ASX dividend share has grown its dividend almost every year between FY17 and FY25, aside from 2020 when it maintained its payout. I think it's likely the business will be able to continue growing its dividends thanks to the progress of its FUM growth.

At its AGM, the company revealed that its total affiliate FUM had grown by 10% in the three months to September 2025 compared to June 2025. I think that bodes well for dividend growth in FY26.

According to the forecast on CMC Markets, the business is projected to pay a dividend which equates to a grossed-up dividend yield of 5.4%, including franking credits.

The post 2 ASX dividend shares raising dividends like clockwork! appeared first on The Motley Fool Australia.

A dividend yield is decided by the dividend payment compared to the share price. A 5% dividend yield can come from any sized business.

The three businesses I'm going to talk about are relatively small but can offer large and resilient dividend payouts.

Rivco Australia Ltd (ASX: RIV)

Rivco Australia, previously known as Duxton Water, owns a portfolio of water entitlements. These entitlements are vital for the Australian agricultural sector, enabling Rivco to generate lease income on either short or long-term contracts. Over time, the company can benefit from a rise in the value of water entitlements, which may also herald an increase in the potential lease income for the ASX dividend stock.

This business is fairly small on the ASX, with a market capitalisation of $228 million at the time of writing, according to the ASX.

Impressively, the business has increased its annual dividend per share every six months for the last several years. Its latest two payments come to a grossed-up dividend yield of 7.1%, including franking credits.

WAM Microcap Ltd (ASX: WMI)

WAM Microcap is a listed investment company (LIC) focused on investing in the smallest and most exciting companies which could deliver good investment returns.

The investment strategy has clearly worked well because at 31 October 2025, the LIC had delivered an average return per year of 17.6%, before fees, expenses and taxes since inception.

That level of investment return, which is not guaranteed to continue, has enabled the ASX dividend stock to deliver large and growing dividends over its lifetime.

In FY25, it paid shareholders a total annual dividend of 10.6 cents per share, translating into a grossed-up dividend yield of 9.5%, including franking credits.

WAM Microcap has a market capitalisation of $451 million according to the ASX, at the time of writing.

Rural Funds Group (ASX: RFF)

Rural Funds is a real estate investment trust (REIT) that helps give Australians exposure to different sectors of the farming world, such as almonds, cattle, macadamias, vineyards and cropping.

The ASX dividend stock has increased its distribution in a majority of the years of the last decade, with no cuts. It's expecting to maintain its distribution at 11.73 cents per unit in FY26, translating into a forward distribution yield of 6%.

According to the ASX, at the time of writing, Rural Funds has a market capitalisation of $766 million.

With the RBA cash rate lower at the end of this year than the start, I believe the outlook for real estate investments is solid, particularly with Rural Funds' expectations of larger rental income in the coming years.

The post 3 little-known ASX dividend stocks to buy for income appeared first on The Motley Fool Australia.

Term deposit interest rates have reduced, making the yields on offer from some businesses much more appealing.

Some businesses with higher yields can be a risk if those payouts are cut. What's the appeal of an 'income stock' if the income suddenly drops significantly or disappears entirely? I think the three stocks below have large and consistent dividends.

GQG Partners Inc (ASX: GQG)

GQG is one of the largest fund managers on the ASX, which provides investors with four main strategies: US shares, global shares, international shares (excluding the US) and emerging market shares.

In recent times, GQG has been defensively positioned with its funds' portfolios because of worries about AI-related valuations. It has recently been vindicated by that decision with plenty of tech/growth stocks falling back. Prior to that, GQG's funds had a long-term track record of outperforming its benchmarks.

I think the ASX dividend stock is still significantly undervalued after rising more than 20% in less than a month. It currently has an annualised dividend yield of 12.7% based on the latest announced quarterly dividend and it's trading at 7x its annualised distributable profit, which I think is very cheap if its funds under management (FUM) grows over the long-term.

Shaver Shop Group Ltd (ASX: SSG)

Shaver Shop sells a wide variety of male and female premium shaving items from its store network of more than 120 stores.

The company's position in the market means that it has been able to secure a number of exclusive agreements with certain shaving brands, giving customers more of a reason to shop at the stores.

Excitingly, the high-yield ASX dividend stock is rolling out products for its own brand called Transform-U to fill gaps in Shaver Shop's item "range of quality, performance and/or price point driven". Transform-U is steadily adding new products to its range, which generates a higher gross profit margin.

On the dividend side of things, it increased its dividend every year since 2017, aside from FY24 when it maintained the dividend. It grew the annual dividend per share to 10.3 cents in FY25, translating into a grossed-up dividend yield of 9.9%, including franking credits.

Rivco Australia Ltd (ASX: RIV)

Rivco Australia (formerly know as Duxton Water Ltd) is a company that owns water entitlements which are leased to irrigators on short or long-term leases.

I like this high-yield ASX dividend stock as a way to indirectly invest in the Australian agricultural sector, which is an important part of the economy.

It can benefit from both the leasing income and a potential rise in the value of water entitlements over time.

Pleasingly, the business has increased its half-year payout every six months since 2017. Its latest paid dividends equate to a grossed-up dividend yield of 7.25%, including franking credits.

The post 3 high-yield ASX dividend stocks that are screaming buys right now appeared first on The Motley Fool Australia.

A business can make a profit in a whole manner of different ways and that can be translated into passive income dollars in just the same way.

I own two of these businesses in my portfolio and I'm optimistic their dividends can continue to be pleasing in the coming years.

Rivco Australia Ltd (ASX: RIV)

Rivco Australia (previously known as Duxton Water) owns a portfolio of water entitlements, which can then be leased to irrigators on short-term or long-term contracts. The company can benefit from both the lease income and the potential increase in value of water entitlements.

Impressively, the little-known ASX dividend share has increased its half-yearly dividend every year since 2017, which is a longer dividend growth streak than most ASX blue-chip share.

The last two dividends translate into grossed-up dividend yield of around 7%, including franking credits, at the time of writing. I'm expecting further dividend growth for the foreseeable future, particularly if water entitlement prices increase.

WAM Microcap Ltd (ASX: WMI)

WAM Microcap is a listed investment company (LIC) that invests in small businesses with strong growth potential.

A fund manager can make investment returns from small shares or big shares. Arguably, it's easier to make larger returns from smaller stocks because they are earlier on in their growth journeys and they are less followed investments (so the price/earnings (P/E) ratio is lower than it could be).

The WAM Microcap portfolio returned an average of 17.3% per year between June 2017 and September 2025, before fees, taxes and expenses.

This strong return has funded large and rising dividends. Its FY25 dividends per share translate into a grossed-up dividend yield of around 9%, including franking credits, at the time of writing.

Service Stream Ltd (ASX: SSM)

This little-known ASX dividend share describes itself as a provider of essential network services, operating across all states and territories.

It works across a number of industries including power grids, the industrial and resources sector, telecommunications, gas, potable water and wastewater, defence, health, renewable, new energy, maritime, social housing, rail, roads and more.

Service Stream delivered a strong FY25, with revenue growth of 1.2%, operating profit (EBITDA) from operations growth of 13.1% and underlying net profit (NPAT-A) growth of 36.7%.

The growth helped them fund an annual dividend per share of 5.5 cents, which represented a year-over-year increase of 22.2%.

At the time of writing, that translates into a grossed-up dividend yield of 3.5%, including franking credits.

The company is expecting to achieve further growth in FY26, with an improvement in the quality of earnings across utility operations and strong levels of infrastructure investment. I think this bodes well for further dividend growth.

The post 3 little-known ASX dividend shares to buy for income appeared first on The Motley Fool Australia.

I wouldn't call a business an ASX dividend share just because it pays any sort of dividend. I believe it needs to have a minimum level of a dividend yield. My thought on the base level required can change depending on where the RBA cash rate is sitting. The five investments I'll highlight all have a pleasing dividend yield.

I'd also like to see reliability in terms of those payments. I'd like to be confident that payments will continue flowing even if the economy runs into trouble.

Finally, I like to see regular dividend growth to help grow cash flow and protect against the negatives of inflation.

I believe all five of the below businesses match what I'm looking for, which is why I own all five of them for passive income (and long-term capital growth).

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts has the best record for dividend growth – it has grown its payout every year since 1998. At the time of writing, the ASX dividend share has a grossed-up dividend yield of 3.9%, including franking credits.

It's an investment conglomerate which is steadily building its portfolio of assets and businesses. Its biggest investments are in areas like telecommunications, resources, industrial properties, building products, swimming schools and agriculture.

MFF Capital Investments Ltd (ASX: MFF)

MFF's main activity is its impressive investment portfolio focused on international shares, with several of the strongest global blue chips. I'm optimistic the portfolio (and future investment changes) can deliver pleasing long-term returns.

The company has grown its annual ordinary payout each year since 2018 and it has a large profit reserve to enable further dividend payments in the coming years.

Its guided FY26 dividends equate to a grossed-up dividend yield of at least 6.1%, including franking credits.

Future Generation Australia Ltd (ASX: FGX)

This is a listed investment company (LIC) which invests in an array of funds focused on ASX shares. But, those fund managers work for free so that Future Generation can donate 1% of its net assets each year to youth-focused charities. I like the initiative and the diversification on offer.

The ASX dividend share has grown its annual dividend each year since it started paying one in 2015. It has grossed-up dividend yield of 7.4%, including franking credits, at the time of writing.

Rivco Australia Ltd (ASX: D2O)

Rivco Australia, recently renamed from Duxton Water, owns a portfolio of water entitlements which is available for irrigators on short-term or long-term leases.

The business can benefit from both the lease income and the growth in the value of water entitlements over the long-term.

The ASX dividend share has increased its half-yearly dividend every year since 2017. It has a grossed-up dividend yield of 6.9%, including franking credits, at the time of writing.

I like the exposure that Rivco provides to the agricultural sector but with less volatility.

Rural Funds Group (ASX: RFF)

Rural Funds is a real estate investment trust (REIT) that owns a portfolio of arms across Australia, including cattle, almonds, macadamias and vineyards.

Its rental income is benefiting from regular rental hikes that are either linked to inflation or grow with fixed annual increases.

It grew its distribution every year between 2014 and 2022, then maintained the payout since. I'm expecting distribution growth in the medium-term following RBA rate decreases.

It's trading at a large discount to its underlying net asset value (NAV) and has a distribution yield of 6%.

The post The top 5 ASX dividend shares I think belong in everyone's portfolio appeared first on The Motley Fool Australia.

For most people, their job is the primary source of income. Earning $50,000 from work may not sound like too much, but it's equivalent to having a $1 million portfolio with a 5% yield.

However, work earnings are limited to what we can earn with our time.

Dividend payments can accumulate and grow over time. Plus, we don't need to work for those payments; that's why it's called passive income. You can think of passive income as a second worker making money for our bank account.

But what sort of ASX dividend shares are the right ones to go for?

Regular pay rises

There are some businesses that have a high dividend yield, such as Shaver Shop Group Ltd (ASX: SSG). But that may not be the most effective dividend pick for working Australians.

Dividends are taxed alongside work earnings on tax returns. Receiving large dividends could mean losing a sizeable chunk of the return each year to the tax office. Paying taxes is not necessarily a bad thing, but it does reduce the net return.

For my own portfolio, I prefer investing in Australian stocks that generally provide regular annual dividend growth.

I focus on names I believe will continue growing their payments in the years to come. Considering my passive dividend income as a worker generating money for me, I want to choose names that I believe have a high chance of delivering regular pay increases.

Dividend growth is helpful in increasing our cash flow to supplement job earnings, it can provide inflation protection, and it's a good sign that the business is growing its profits and its underlying value over time.

In other words, ASX dividend shares that are hiking the dividend are likely to deliver solid total returns, not just pleasing dividend yields.

Which ASX dividend shares are good options?

I prefer to invest in businesses that have a proven track record of dividend payments and have demonstrated a commitment to increasing those payouts for investors.

There are a few in my portfolio (and a couple that aren't) that I'll highlight as ideas, such as:

• Investment conglomerate Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
• Energy infrastructure giant APA Group (ASX: APA)
• Water entitlement owner Duxton Water Ltd (ASX: D2O)
• Telco Telstra Group Ltd (ASX: TLS)
• Bunnings and Kmart owner Wesfarmers Ltd (ASX: WES)
• Listed investment companies (LICs) MFF Capital Investments Ltd (ASX: MFF), Future Generation Australia Ltd (ASX: FGX), L1 Long Short Fund Ltd (ASX: LSF) and Hearts and Minds Investments Ltd (ASX: HM1)

I believe a portfolio comprising the above names, along with a few others, could yield a pleasing mix of diversification and dividends. How great would it be to be able to receive $10,000 (or $100,000) of annual dividend income from Australian stocks to boost our finances?

Investing $1,000 today in an ASX dividend share could unlock $50 of annual income. If that dividend grew by 10% per year, it'd become $55 after year one, $60.50 after year two and so on. Compounding is a very powerful tool, particularly when we regularly invest in our portfolios.

The post Grow your dividends alongside your job earnings with these Australian stocks appeared first on The Motley Fool Australia.

CBA may have grown its dividend significantly over the last three decades, but its payout has not always been reliable, nor has growth been strong recently

Commonwealth Bank cut its dividend in 2020 due to the impacts of the COVID-19 pandemic, so it has only grown its annual dividend consecutively over the last few years. Meanwhile, the FY25 payout increased by only 4% to $4.85 per share, meaning the current grossed-up dividend yield is 4.2%, including franking credits.

On top of that, CBA faces a lot of competition in its industry from the likes of Macquarie Group Ltd (ASX: MQG), ANZ Group Holdings Ltd (ASX: ANZ), Westpac Banking Corp (ASX: WBC), and National Australia Bank Ltd (ASX: NAB) that would love to take market share from the bank.

Normally, I'd mention that a business like Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) is a stock that could provide more meaningful returns when it comes to dividend investing. But there are a few others I want to tell you about. In this article, I want to highlight Duxton Water Ltd (ASX: D2O).

Impressive ASX dividend stalwart share

Duxton Water owns a portfolio of water entitlements that can be utilised by irrigators for short-term or long-term needs. The company can benefit from a mixture of lease income from the water and potential capital gains from the value of the entitlements.

The company has increased its annual dividend per share every year since it first started paying a dividend in 2017. It has a longer dividend growth streak than CBA shares.

Its dividend yield is also much more appealing. At the time of writing, its latest two dividend payments come to a grossed-up dividend yield of 7%. In other words, the business offers a dividend yield that's almost three whole percentage points better than what's on offer from Commonwealth Bank.

Another reason I like Duxton Water is that it offers compelling diversification compared to owning the ASX bank share. Commonwealth Bank is heavily linked to the performance of the economy, whereas the performance of water entitlements is largely uncorrelated to the Australian economy. I view it as an appealing way to gain exposure to the agricultural sector without direct exposure to the cyclical nature of farming.

Duxton Water is trading at an appealing valuation – at the time of writing, it's trading at a discount of around 10% to its post-tax net asset value (NAV) as of September 2025, while CBA shares are regularly described as expensive.

Finally, I'm optimistic about the future of the company thanks to a growing volume of crops with higher water demand, such as almonds, which could enable higher water prices in the coming years.

Overall, I think this is a great time to invest in the ASX dividend stalwart share for the long term.

The post An ASX dividend stalwart every Australian should consider buying over CBA shares appeared first on The Motley Fool Australia.

Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), ANZ Group Holdings Ltd (ASX: ANZ), National Australia Bank Ltd (ASX: NAB), Macquarie Group Ltd (ASX: MQG), Bank of Queensland Ltd (ASX: BOQ) and Bendigo and Adelaide Bank Ltd (ASX: BEN) are all ASX financial shares.

BHP Group Ltd (ASX: BHP), Rio Tinto Ltd (ASX: RIO), and Fortescue Ltd (ASX: FMG) are all miners (along with other names).

Diversification can be a powerful tool to help reduce the risk of being too exposed to one sector, without necessarily reducing returns. It's with diversification in mind that I want to highlight the ASX dividend stocks Rural Funds Group (ASX: RFF) and Duxton Water Ltd (ASX: D2O).

Exposure to the agriculture sector

Agriculture is one of the most important areas of the Australian economy, but it can be volatile and cyclical as an operator. However, there are other ways to gain exposure to this impressive industry.

Rural Funds is a real estate investment trust (REIT) that owns a diversified portfolio of farms, including cattle, almonds, macadamias, vineyards, and cropping. These farms are leased to high-quality tenants. Rural Funds also owns a portfolio of water entitlements that are available for tenants to utilise.

Duxton Water invests in a portfolio of water entitlements and leases them to farmers on a short-term or long-term basis.

Good dividend income

Both ASX dividend stocks generate lease cash flow from their assets, allowing them to pay pleasing passive income to investors.

While they may not have the biggest dividends around, I'd describe them as sustainable and at a size that can allow them to increase the payouts in the future.

Rural Funds is expecting to pay a cash distribution of 11.73 cents per unit in FY26, which translates into a forward distribution yield of 6.1%. That's far better than what's on offer from a 12-month term deposit these days.

Turning to Duxton Water, its last two declared dividends come to a total of 7.43 cents per share. That translates into a grossed-up dividend yield of 7%, including franking credits.

Neither of them has given investors a payout cut since they listed in the 2010s, which is a pleasingly consistent record.

The ASX dividend stocks trade at a discount to their underlying value

I wouldn't advocate buying an ASX dividend stock just for the sake of diversification. I'd also want to know that it's good value.

Are both of these businesses at a good price? Let's take a look.

At the end of August 2025, Duxton Water had a reported post-tax net asset value (NAV) of $1.67, suggesting the current share price is trading at a discount of 9%.

Meanwhile, at June 2025, Rural Funds reported it had an adjusted NAV of $3.08. That implies it's trading at a 38% discount to its underlying value, as of the time of writing.

Following multiple RBA rate cuts, I believe both of these ASX dividend stocks are trading at attractive prices and look very appealing for dividend income.

The post What I love about these 2 ASX dividend stocks appeared first on The Motley Fool Australia.

I like businesses where it's clear how they are going to grow earnings because profit is what funds ongoing payments and can enable larger payouts to shareholders.

Dividend growth isn't guaranteed of course, but in a world where there's inflation and uncertainty, it's appealing to have an understanding of the outlook. Let's take a look at two of the businesses I'd put on an income watchlist and buy today.

Charter Hall Long WALE REIT (ASX: CLW)

This is a real estate investment trust (REIT) that owns various types of commercial property in its portfolio.

One of the compelling aspects of this business is that it has a high weighted average lease expiry (WALE). In other words, if you look across the various properties and rental contracts, the average expiry was 9.3 years away as of 30 June 2025. That gives investors a significant degree of rental visibility and security.

There are a wide range of quality tenants leasing the properties including Endeavour Group Ltd (ASX: EDV), various state and federal government entities, Telstra Group Ltd (ASX: TLS), BP, Coles Group Ltd (ASX: COL), Metcash Ltd (ASX: MTS), David Jones, Arnott's Group, Bunnings and Westpac Banking Corp (ASX: WBC). I like the wide diversification of the property portfolio.

The ASX share has built in organic growth for its rental profit, thanks to annual increases which are either fixed or linked to inflation. This is a useful tailwind that can help support higher earnings and payouts in the coming years.

It's expecting to grow its FY26 distribution per security by 2% to 25.5 cents, which translates into a forward distribution yield of approximately 5.5%, at the time of writing.

Duxton Water Ltd (ASX: D2O)

Duxton Water is another ASX share that I think is underrated as an option for dividend investors.

The business owns a portfolio of permanent water entitlements which allows it to offer long-term entitlement leases, forward allocation contracts and spot allocation supply to Australian irrigators. It may soon change its name to Rivco Australia after the approval of the internalisation of management.

Duxton Water can generate a return for shareholders from both the lease income and long-term growth in the value of the water entitlements.

The ASX share recently announced in its August 2025 monthly update that its net asset value (NAV) increased by 1 cents per share, driven by "strategic trades, additional entitlement allocations and improved allocation prices." In the last 12 months, its post-tax NAV  delivered a return of 13.2%.

While July rainfall temporarily reduced prices at the start of August, the return of average-to-drier conditions across the southern Murray-Darling Basin supported a rebound, according to Duxton Water. Allocation prices ended winter 2025 at their highest seasonal levels since 2019.

The business has increased its half-yearly dividend every six months since November 2017. Not many ASX shares have a consistent dividend growth streak spanning eight years. At the time of writing, its latest two dividends equate to a grossed-up dividend yield of approximately 7%, including franking credits.

The post Dividend investors should put these 2 top ASX shares on their watchlist appeared first on The Motley Fool Australia.

Duxton Water is not exactly a big business, it has a market capitalisation of around $230 million, according to the ASX.

As the name suggests, it's involved in water. Its objective is to make returns from a portfolio of permanent water entitlements and use this to provide flexible water supply solutions to its Australian farmers.

It generates returns by offering irrigators a range of supply solutions, including long-term entitlement leases, forward allocation contracts and spot allocation supply. In other words, farmers can utilise short-term and long-term supply. Duxton Water can also benefit from the increase in the value of water entitlements too.

Appealing ASX dividend stock

Dividend growth and stability are two of the main factors that are compelling to me.

Impressively, the business has grown its dividend every six months since November 2017. There are not many businesses that have a dividend record like that on the ASX. In-fact, I'd say there are very few.

Of course, dividend growth is not guaranteed, but I think Duxton Water is capable of continuing that run.

At the current Duxton Water share price, the ASX dividend stock offers a grossed-up dividend yield of just over 7%, including franking credits.

Why I think this is a good time to invest

Duxton Water said in its July update that major water storages across the water system remain "at their lowest levels for this time of year since 2020."

Those reduced dam storages have resulted in the lowest opening allocations to NSW general security entitlements since 1 July 2020.

The ASX dividend stock also noted that several small parcels of lower Murray entitlements were also acquired at attractive prices during the month.

I'm expecting water demand to increase in the coming years with crops like almonds requiring more water than others, which could increase the value of water entitlements, along with inflation over time.

The business is trading at an attractive value, in my view. Every month, it tells investors what its underlying value is, which takes into account the value of the water entitlements, any debt and so on.

In July 2025, it had a post-tax net asset value (NAV) of $1.66 and a pre-tax NAV of $1.86, implying share price discounts of 11% and 20%, respectively. I think this is a very appealing discount.

Other ASX shares may be capable of even stronger returns.

The post 1 ASX dividend stock down 16% I'd buy right now appeared first on The Motley Fool Australia.

The BHP FY25 result wasn't thrilling, considering the dividend was reduced compared to FY24. That may be disappointing, but understandable considering the iron ore price fell during the year.

On a positive note, copper earnings increased, helping offset some of the iron ore pain.

For investors that have significant exposure to BHP, they may want to consider adding further diversification for their income by looking at other names. Some income-seekers may like more of their portfolio being less reliant on Chinese buying of resources.

Let's take a look at some compelling ASX dividend stock ideas.

Duxton Water Ltd (ASX: D2O)

Duxton Water is a unique business in terms of what it can offer investors. It owns a portfolio of water entitlements, offering a range of water supply options for farmers, including long-term entitlement leases, forward allocation contracts, and spot allocation supply.

It has grown its dividend every year in the last seven years, which has been much more consistent than BHP.

Duxton Water can generate distributable profit from lease income and growth in the value of the water entitlements.

At 31 July 2025, just over half of the entitlement portfolio was leased, with a weighted average lease expiry (WALE) of 3.7 years.

The ASX dividend stock also noted that major water storages remain at the lowest levels for this time of year since 2020. Duxton Water also said in its July 2025 update that it acquired several small parcels of lower Murray entitlements at attractive prices during the month.

The last two paid dividends come to a grossed-up dividend yield of 7.1%, including franking credits, at the time of writing.

Centuria Industrial REIT (ASX: CIP)

This is a real estate investment trust (REIT) that owns a portfolio of industrial properties across Australian cities. This area of the property market has a very low vacancy rate, which helps the business maintain a high occupancy rate and pushes up rental income.

There are a number of tailwinds for industrial properties, including rising adoption of e-commerce, stronger demand for refrigerated space (for food and medicine), significant demand for data centres, and so on.

The combination of rental income growth and falling interest rates is a powerful combination for the ASX dividend stock's ongoing rental profit. Rate cuts can both reduce the interest costs for the business and increase the underlying value of the properties.

In FY26, the business is expecting to grow its rental profit (funds for operations (FFO) per security) by 6% and the distribution per security could increase by 3% to 16.8 cents. At the current Centuria Industrial REIT security price, it translates into a distribution yield of around 5%.

The post Overinvested in BHP shares? Here are two alternative ASX dividend stocks appeared first on The Motley Fool Australia.

The ASX share market is close to its all-time high, but there are still some businesses trading at bargain prices.

There are plenty of companies that seem fully valued to me, so they don't appeal. But, there are a few ASX shares I think are excellent buys today.

Bailador Technology Investments Ltd (ASX: BTI)

I think businesses that are growing quickly are the ones that are most likely to deliver good returns. Typically, it's software businesses that are able to deliver the best growth because there are no physical limitations to their growth, such as requiring more stores, more warehouses, more manufacturing and so on.

This business is an investment company that focuses on relatively small, compelling technology companies. Pleasingly, there a number of attributes that businesses need to have to be in this portfolio, including having a proven business model with attractive unit economics, international revenue generation, a huge market opportunity and the ability to generate repeat revenue.

This has led to a portfolio that includes Siteminder Ltd (ASX: SDR), DASH, Updoc, Access Telehealth, Expedition Software, Rosterfy, PropHero and Hapana.

The ASX share's portfolio of companies as a group is seeing strong revenue growth, which is helping grow their underlying value and helping this ASX share pay solid dividends to shareholders as well to unlock franking credits.

Why is Bailador a bargain ASX share? It's because it reported pre-tax net tangible assets (NTA) of $1.79 per share at 30 June 2025, with a post-tax NTA of $1.64 per share. That means it's currently trading at a discount of 29% to the most recent post-tax NTA.  

Duxton Water Ltd (ASX: D2O)

This business is focused on providing water access to farmers in exchange for lease income thanks to a portfolio of water entitlements.

A few months ago, the business paid its 16^th consecutive and increasing dividend of 3.71 cents per share as it continues to secure new leases with new and existing farmers.

The company revealed in its latest monthly update that lease yields have risen considerably over the past few months, with it now seeking to achieve lease yields of approximately 5% per year.

In the 12 months to June 2025, the business achieved a total return of 16.6%, which is based on the net asset value (NAV) movement, plus the dividends.

Water prices could increase further if the level of water demand stays strong. According to Duxton Water, in the 2024/2025 water year, the VIC Murray catchment zone recorded 1,165 GL of seasonal water use, the highest in 12 years.

The business reported it had a post-tax net asset value (NAV) of $1.65 per share at 30 June 2025. That means at the current Duxton Water share price, it's trading at a 7% discount to the post-tax NAV.

The post Why I think these 2 ASX shares are bargain buys appeared first on The Motley Fool Australia.

But how can we create that cash flow of investment income? Buying a property can require tens of thousands of dollars. It could take a long time to save that much.

The great thing about investing in ASX shares is that we don't need to save a ton to be able to start investing. In fact, some brokers allow us to start investing with as little as $500.

I wouldn't necessarily try to find something that has the biggest dividend yield around because those sorts of businesses don't typically have a reputation for long-term stability or continuous growth. There are lower-risk investments we can buy to start making ASX passive income for our portfolios.

Individual ASX shares

Australian companies are some of the most appealing businesses for dividends because of both the franking credits and the generous dividend payout ratios (to distribute those franking credits for shareholders).

I'd only want to invest in businesses that have a compelling long-term future, where earnings growth seems likely and that can assist dividend growth.

I'm thinking of businesses such as investment conglomerate Washington H. Soul Pattinson and Co. Ltd (ASX: SOL), property owner Centuria Industrial REIT (ASX: CIP), water entitlement owner Duxton Water Ltd (ASX: D2O), telco Telstra Group Ltd (ASX: TLS), funds management business GQG Partners Inc (ASX: GQG) and Kmart and Bunnings owner Wesfarmers Ltd (ASX: WES).

I think there's a very good chance of the above businesses growing their annual payouts regularly in the coming years.

Exchange-traded funds

Exchange-traded funds (ETFs) can be effective options for ASX passive income because of how they enable investors to buy a portfolio of businesses in just a single investment, which is a great tool for diversification.

If investors want a portfolio of large ASX shares then there are a couple of options. There's one that let Aussies invest in dozens of high-yielding ASX businesses – Vanguard Australian Shares High Yield ETF (ASX: VHY).

The Vanguard Australian Shares Index ETF (ASX: VAS) allows Aussies to invest in the S&P/ASX 300 Index (ASX: XKO), which includes those higher-yielding names too, such as Rio Tinto Ltd (ASX: RIO), National Australia Bank Ltd (ASX: NAB) and Westpac Banking Corp (ASX: WBC). The VAS ETF also owns businesses better suited for capital growth.

There are other ETFs that can also provide a good dividend yield level, including Betashares FTSE 100 ETF (ASX: F100) and Betashares India Quality ETF (ASX: IIND), which provide exposure to the UK and India share markets, respectively.

Listed investment companies

One area of the share market that shouldn't be discounted for ASX passive income are listed investment companies (LICs), which enable us to invest in a company whose activity is making investments rather than selling products or services.

Part of the appeal of LICs is that they can utilise the profits of investment performance to pay a steady flow of dividends to investors.

The oldest and largest LIC – Australian Foundation Investment Co Ltd (ASX: AFI) – has been very consistent with its dividends this century.

Other LICs which appeal based on their dividend records include WAM Microcap Ltd (ASX: WMI), WCM Global Growth Ltd (ASX: WQG) and L1 Long Short Fund Ltd (ASX: LSF).

The post How to start generating ASX passive income with as little as $500 appeared first on The Motley Fool Australia.

The Reserve Bank of Australia (RBA) cash rate currently appears to be in a rate-cutting phase as the war on inflation seems mostly complete, though not totally finished, with the danger of US tariffs shaking up the current economic dynamic still lingering.

While the highest-yielding stocks may not always be a great choice for income investors – sometimes dividends are cut – there are a few high-yielding names that I believe look very appealing, such as the two below.

Rural Funds Group (ASX: RFF)

Rural Funds is one of the most compelling businesses for income because of how consistent it has been at paying a reliable distribution despite the headwind of higher interest rates over the last few years.

This real estate investment trust (REIT) owns a portfolio of farms across Australia, including cattle farms, vineyards, almond farms and macadamia farms.

I like that Rural Funds is able to look across various farming sectors for opportunities because it opens up more avenues to find the best investments and reduces the risk of being too exposed to one particular type of farm.

Farming can be a cyclical industry, but the ASX dividend share largely doesn't take on operational risks. Thankfully, that's mostly down to the tenants.

Those farms are regularly increasing their rental income because most farming contracts have rental indexation built in, either with fixed annual increases or rental hikes linked to inflation.

With interest rates seemingly on the way down, I'm hopeful the business can return to distribution growth after a few years of maintaining the distribution.

In FY26, it's expecting to pay a distribution of 6.4%.

Duxton Water Ltd (ASX: D2O)

This is another business involved with the agricultural sector. It owns a portfolio of permanent water entitlements and provides a variety of water supply solutions to Australian farmers.

Irrigators can utilise long-term entitlement leases, forward allocation contracts and spot allocation supply.

Impressively, the ASX dividend share has grown its distribution each year since 2017, which I'd describe as one of the best dividend records of a company of the size of Duxton Water.

The business can benefit from both the lease income generated from its entitlements as well as any increase in value of the entitlements over time.

This could be a useful time to invest in Duxton Water shares because according to the business, the last 12 months have been "significantly drier", resulting in increased demand for long-term water security. At 30 June 2025, the major southern Murray-Darling-Basin storages were "at their lowest in five years for this time of the year" which has contributed to a reduced supply of available water.

I think this ASX dividend share is a useful way to diversify an income-focused portfolio. Its trailing grossed-up dividend yield is 6.9%.

The post 2 compelling ASX dividend shares with yields above 6% appeared first on The Motley Fool Australia.

Being unique doesn't necessarily mean it's a great investment. However, if it offers regular dividend growth, it could be a particularly attractive business to own.

Over the last few years, we've seen how inflation can be a dangerous financial force, eating away at the value of a dollar. For that reason, I believe dividend growth is an important attribute.

The two ASX dividend shares below offer both dividend growth and something unique, in my opinion.

Duxton Water Ltd (ASX: D2O)

This company has built a portfolio of permanent water entitlements and uses this to provide farmers with flexible water supply. Irrigators can utilise long-term entitlement leases, forward allocation contracts and spot allocation supply.

Pleasingly, the business has grown its payout every six months since 2017, which is an impressively long record considering how many other companies have cut their payouts during that time.

Duxton Water said in its June monthly update that the past 12 months have been significantly drier, resulting in increased demand for long-term water security. As of 30 June 2025, the major southern Murray-Darling Basin storages were at their lowest levels in five years for this time of the year, contributing to a reduced supply of available water, according to Duxton Water.

Market prices of high-security entitlement leases have increased over the last three or four months, reflecting stronger demand.

The ASX dividend share trading at a 9% discount to the post-tax net asset value (NAV), enabling it to provide a solid trailing grossed-up dividend yield of 7%, including franking credits.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts is one of the oldest businesses on the ASX. It's over 120 years old and has been listed during all of that time.

One of the most important things that dividend investors need to know about this company is that it has paid a dividend in every one of those 120+ years, and it has also grown its annual ordinary dividend every year since 2000.

This ASX dividend share is virtually unique because it owns an extensive portfolio of private and public investments. Some of its private businesses include electrification, swimming schools, agriculture, financial services, and credit.

It also owns numerous ASX shares in its portfolio, including Brickworks Ltd (ASX: BKW), New Hope Corporation Ltd (ASX: NHC), TPG Telecom Ltd (ASX: TPG), Tuas Ltd (ASX: TUA), Perpetual Ltd (ASX: PPT), BHP Group Ltd (ASX: BHP), Macquarie Group Ltd (ASX: MQG), Wesfarmers Ltd (ASX: WES), Commonwealth Bank of Australia (ASX: CBA), and Goodman Group (ASX: GMG).

Not only does it have an incredible track record of dividend reliability, but it also has a pleasingly diverse portfolio, as I've outlined above. Its grossed-up dividend yield is 3.4%, including franking credits.

The post What I love about these 2 ASX dividend shares appeared first on The Motley Fool Australia.

One way to try to retire early would be to invest in the best ASX growth shares.

However, another approach could be to choose investments that offer large dividend yields. This means someone would need a smaller portfolio balance to receive the necessary cash flow compared to one with a low dividend yield (which would require a larger balance). For example, you'd need double the size of a portfolio with a 3% dividend yield compared to a 6% dividend yield.

In this article, I'm going to talk about three stocks, but it's important to have a diversified portfolio – more than three names – if you rely on dividend income for life expenses. I think it's just as important to invest in a growing business because a company that cuts its dividend is no use to someone relying on passive income.

So, below are three ASX All Ords shares that could help create an early retirement with a strong dividend yield and further dividend growth in the coming years.

Accent Group Ltd (ASX: AX1)

Accent sells footwear through its own brands, and it also acts as a distributor for global businesses. Some of its own businesses include The Athlete's Foot, Stylerunner, and Platypus, while global brands it works with include Vans, Hoka, Skechers, Herschel, Ugg, Sebago, Saucony, and more.

The ASX All Ords share is working on growing profit in multiple ways, including opening more stores and working with more brands. It's going to expand with Dickies and Lacoste in FY26, while the Frasers' partnership with Sports Direct could be a game-changing opportunity.

According to the forecast on Commsec, Accent is expected to pay a grossed-up dividend yield (including franking credits) of 9.8% in FY26 and 10.1% in FY27. Those are strong yields to help retirement. Its earnings per share (EPS) is projected to grow by 34% in FY26 and another 12.7% in FY27.

Duxton Water Ltd (ASX: D2O)

Duxton Water owns water entitlements, which can be leased to farmers through short-term or long-term contracts. I like this company as a way to gain exposure to Australia's excellent agricultural sector, but with less volatility.

The business has grown its half-year dividend every six months since 2017, which is a great record in my view. The last two declared dividends come to a grossed-up dividend yield of 6.7%, which is a solid starting point for a retirement stock.

I think the ASX All Ord share's lease income could rise in the coming years because of the increasing importance of water access and how Duxton Water can provide that water security.

GQG Partners Inc (ASX: GQG)

GQG is a fund manager based in the US with a global client base. It offers strategies for US shares, non-US international shares, global shares, and emerging market shares.

Pleasingly, a fund manager doesn't require much capital to grow, so it's able to pay a generous dividend and still deliver growth for ASX investors. A key factor for its success is delivering good investment returns for its clients – each of GQG's main funds has outperformed its benchmarks since inception.

Good performance for clients helps grow the ASX All Ords share's FUM organically and encourages clients to allocate additional money to GQG. It's currently seeing more than US$1 billion of net inflows each month. The fund manager hardly charges any performance fees, so FUM growth is an integral factor.

According to estimates from Macquarie, GQG is expected to pay a dividend yield of 11.8% in FY26 and 12.5% in FY27. Those are huge yields for investors hoping for retirement.

The post 3 under-the-radar ASX All Ords shares that could fund your early retirement appeared first on The Motley Fool Australia.