It’s pretty hard to find the big dividends that we used to see on the ASX these days. ASX income stock heavyweights like Telstra Group Ltd (ASX: TLS), Commonwealth Bank of Australia (ASX: CBA), and Coles Group Ltd (ASX: COL) don’t sport the yields that they once did.
There are still decent yields to be found, of course. But many of these hail from the more volatile end of the market. Miners and energy stocks can pay out big for investors, but they are also highly cyclical and therefore rather unreliable dividend shares.
However, if you are looking for your next ASX income stock, there’s a name that I think merits a look from any dividend-hungry investor today. It is Plato Income Maximiser Ltd (ASX: PL8).
Plato is a listed investment company (LIC), meaning it owns and manages a portfolio of underlying investments on behalf of its shareholders. This portfolio consists of many ASX income stocks. At the latest count, it included all of the shares mentioned above, as well as BHP Group Ltd (ASX: BHP), Qantas Airways Ltd (ASX: QAN), National Australia Bank Ltd (ASX: NAB), Medibank Private Ltd (ASX: MPL), and many more.
An ASX income stock with a lot to show
Plato collects the income these stocks pay out and passes it on to its shareholders through dividend payments. This Plato does monthly, which many income investors will no doubt find incredibly useful.
The ASX income stock has doled out 12 dividends over the past year, each worth 0.55 cents per share. At the current Plato share price of $1.39 (at the time of writing), this ASX income stock has a trailing dividend yield of 4.75%.
Many income-focused investments have a tendency to sacrifice overall returns for a higher upfront yield. But this is not a trap Plato falls into, at least yet. As of 30 April, Plato has delivered an overall return (share price growth plus dividends) worth 9.9% per annum since its inception in 2017. That’s slightly above the 9.8% that the broader market has delivered over the same period.
Fortunately, Plato’s dividends tend to come with full-franking credits attached too. This combination of monthly dividends, a relatively large starting yield, and those full-franking credits makes Plato a formidable ASX income stock. As such, I think it’s well worthy of consideration for anyone searching for yield today.
The post This ASX income stock has a 4.75% yield and pays out monthly appeared first on The Motley Fool Australia.
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More reading
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- Is now the time to turn to high yield dividend shares?
Motley Fool contributor Sebastian Bowen has positions in Plato Income Maximiser. 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 Telstra Group. The Motley Fool Australia has recommended BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.