If you’re in retirement or approaching it, you may be looking for a combination of capital gains and income.
But which ASX shares could help you achieve this? Two top options for retirees to look at are listed below. Here’s what you need to know about them:
Collins Foods Ltd (ASX: CKF)
Collins Foods could be a good option for a retirement portfolio. It is a quick service restaurant operator with a focus on KFC restaurants. This focus is working wonders for the company and has underpinned solid earnings and dividend growth over the last few years.
Positively, this has continued in FY 2021. For example, during the first half of FY 2021, it reported an 11.3% increase in revenue and a 15.1% lift in underlying net profit after tax.
The good news is that the company still has a long runway for growth both at home and in the underpenetrated European market.
One broker that is a fan of Collins Foods is UBS. It currently has a buy rating and $11.65 price target on its shares.
UBS is also forecasting a fully franked dividend of 22 cents per share in FY 2021. Based on the latest Collins Foods share price, this represents a ~2% dividend yield.
Wesfarmers Ltd (ASX: WES)
Another ASX share to consider for a retirement portfolio is Wesfarmers. This conglomerate has been growing at a solid rate for many years and has been tipped to continue doing so over the next decade.
This is due to its portfolio of leading retail brands such as Bunnings, Catch, and Kmart. In addition, supporting this growth will be its industrial businesses and its investments in the lithium space.
Another positive is the company’s balance sheet, which provides it with significant firepower for earnings accretive acquisitions.
Earlier this week Goldman Sachs retained its buy rating and $59.70 price target on the company’s shares. The broker also advised that it is forecasting a fully franked dividend yield of ~3% for the next 12 months. This certainly is an attractive yield in the current environment.
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Returns As of 15th February 2021
More reading
- Wesfarmers’ (ASX:WES) Bunnings open to hosting COVID vaccine hubs
- Popeyes down under? Collins Foods’ (ASX:CKF) KFC may have a new competitor
- What’s happening with the Wesfarmers (ASX:WES) share price today?
- Why the Wesfarmers (ASX:WES) share price is edging higher
- Top broker thinks Wesfarmers (ASX:WES) share price is good value
Motley Fool contributor James Mickleboro owns shares of Collins Foods Limited. The Motley Fool Australia owns shares of Wesfarmers Limited. The Motley Fool Australia has recommended Collins Foods Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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