Warren Buffett.

Just drop that name around any group of ASX dividend investors and you’re likely to get their attention.

And for good reason.

As the long-running CEO of multinational conglomerate Berkshire Hathaway, Warren Buffett has delivered returns that most fund managers can only dream of.

The Oracle of Omaha isn’t shy about revealing the secrets to his investing success, either.

His many decades of success stem from what, at least on the surface, appear to be some very simple investing rules.

Among those, Warren Buffett looks for high-quality companies with great management and brands. Companies that have the ability to control prices and that are fairly valued or, better yet, trading at a bargain.

Importantly, he has a very long-term investment horizon, ignoring the ups and downs along the way.

While some of the outsized gains he’s reaped come from capital appreciation, a large portion stems from dividends.

In fact, it’s reported that Buffett will rake in some US$6 billion (approximately AU$9 billion) in dividend income this year.

If it works for Warren Buffett, should I buy ASX dividend shares right now?

ASX dividend shares offer an excellent path towards garnering a reliable passive income stream. And the Aussie market is rather unique in that it offers franking credits, which can offer some handy tax benefits at the end of the financial year.

Now I don’t reckon you or I will ratchet up $9 billion in annual payouts like Warren Buffett. Though one can dream!

But there are a large number of high-quality ASX dividend shares to choose from to begin building that passive income.

Retail giant Harvey Norman Holdings Ltd (ASX: HVN), for example, has paid out a total of 30.5 cents in fully franked dividends over the past 12 months.

At the current share price of $3.76, that works out to a trailing yield of 8.1%.

If you’d like to receive the company’s interim dividend of 13 cents per share, you’ll need to own the stock at the close on 31 March, when Harvey Norman trades ex-dividend.

Another ASX dividend share investors may want to run their slide rules over to build a passive income stream like Warren Buffett’s is Domino’s Pizza Enterprises Ltd (ASX: DMP).

The global pizza chain has struggled lately in the face of higher inflation and a return to dining out over home delivery during the pandemic times.

Still, Domino’s declared a partially franked interim dividend of 67.4 cents per share atop the earlier 68.1 cent per share final dividend. At the current share price, the stock offers a trailing yield of 3%, franked at just over 60%.

The post Warren Buffett rakes in $9 billion in annual dividend income. Should I buy ASX dividend shares right now? appeared first on The Motley Fool Australia.

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More reading

• 3 ASX growth stocks down 40%-65% to buy now and hold
• These 3 ASX shares just halved. I would buy one of them: experts
• Why did the Domino’s share price just hit a multi-year low?
• These 3 ASX 300 shares are dividend dynamos!
• Gerry Harvey just bought $8 million worth of Harvey Norman shares. Should you buy?

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Berkshire Hathaway, Domino’s Pizza Enterprises, and Harvey Norman. The Motley Fool Australia has positions in and has recommended Harvey Norman. The Motley Fool Australia has recommended Berkshire Hathaway and Domino’s Pizza Enterprises. 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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