Unfortunately for income investors, it looks as though interest rates are going to remain at ultra low levels for some time to come.
But don’t worry because the Australian share market is home to countless dividend shares. Two that offer generous yields are listed below. Here’s what you need to know about them:
BWP Trust (ASX: BWP)
BWP is the largest owner of Bunnings Warehouse sites across Australia, making it the envy of many retail landlords.
At the last count, BWP had a total of 68 properties which were leased to the home improvement giant. It also owns seven other properties, adjacent to its Bunnings properties, that are leased to other retailers.
Pleasingly, thanks to Bunnings’ strong performance during the pandemic, it has been able to collect rent as normal this year. This trend looks set to continue for the foreseeable future given the overall strength of the hardware giant’s business and Australia’s economic recovery. This could bode well for future dividend payments.
For now, the BWP board is aiming to pay a full year distribution of ~18.3 cents per share in FY 2021. Based on the current BWP share price, this equates to an attractive 4.4% dividend yield.
Telstra Corporation Ltd (ASX: TLS)
Another ASX dividend share to look at is Telstra. Thanks to its improving outlook due to the T22 strategy and its separation and asset monetisation plans, Telstra’s dividend appears to have finally bottomed at 16 cents per share.
And with management targeting a return to growth in FY 2022, it may not be long until the company is in a position to start thinking about dividend increases once again.
Goldman Sachs is a fan of the company. Its analysts currently have a buy rating and $4.00 price target on the company’s shares.
The broker is forecasting 16 cents per share fully franked dividends for the foreseeable future. Based on the latest Telstra share price, this will mean dividend yields of 4.65%.
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Returns As of 15th February 2021
More reading
- Why it might be time to give the TPG (ASX:TPG) and Telstra (ASX:TLS) share price a second look
- ASX 200 down 0.4%: Xero sinks, Telstra hit with $50m fine
- Telstra (ASX:TLS) share price higher despite being hit with $50 million penalty
- Why has the Telstra (ASX:TLS) share price retreated from its 52-week high?
- Brokers name 3 ASX shares to buy now
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra 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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