Stock Pick

  • 3 high yield ASX dividend shares to buy right now

    ASX dividend shares

    I continue to believe that income investors would be better off with ASX dividend shares than term deposits.

    Especially given the outlook for interest rates in Australia. According to the latest weekly economic report by Westpac Banking Corp (ASX: WBC), it continues to see the cash rate remaining at 0.25% for a long time to come.

    But which ASX dividend shares should you buy? Here are three that I would snap up today:

    BWP Trust (ASX: BWP)

    The first ASX dividend share to consider buying is BWP. It is a real estate investment trust with a focus on warehouses. Most of BWP’s warehouses are leased to hardware giant Bunnings, which is owned by Wesfarmers Ltd (ASX: WES). Interestingly, Wesfarmers is also a major BWP shareholder with a ~23.6% stake. I think this is a big positive as it is unlikely to do anything (vacate properties en masse, etc) that would negatively impact BWP’s performance and share price. At present I estimate that it offers investors a forward 5.2% yield.

    Commonwealth Bank of Australia (ASX: CBA)

    Another ASX dividend share to consider buying is Commonwealth Bank. Although the banks are struggling right now because of the pandemic, with the economy now reopening, I’m optimistic that the worst is behind them. Especially after they collectively announced billions of dollars of provisions over the last few weeks. And while Commonwealth Bank will almost certainly be forced to cut its dividend in FY 2021, the pullback in its share price means it is likely to still provide a very generous yield. I estimate that its shares offer a forward fully franked yield of 6.2%.

    Rio Tinto Limited (ASX: RIO)

    A final dividend share to consider buying is Rio Tinto. It feel it would be a great option for income investors that are not averse to investing in the resources sector. The mining giant has been a strong performer over the last few years and looks set to continue this trend in FY 2020. Especially given how iron ore prices remain at lofty levels despite the pandemic. I expect this to lead to strong free cash flows and big dividends for shareholders. In fact, last week Morgans suggested that iron ore prices could continue to rise and believes its shares currently offer a fully franked ~9% FY 2021 dividend yield.

    And here is another dividend share which looks well-positioned to grow strongly during the pandemic. This could make it a must buy for income investors..

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    Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of Wesfarmers Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

    The post 3 high yield ASX dividend shares to buy right now appeared first on Motley Fool Australia.

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  • U.S. Stock Futures Open Flat as Tensions Mount: Markets Wrap

    U.S. Stock Futures Open Flat as Tensions Mount: Markets Wrap(Bloomberg) — Currency markets and U.S. equity futures saw a placid start to trading early on Monday as traders monitored more signs of economies reopening around the world against a deepening of tensions between the U.S. and China.The Australian dollar and the offshore yuan edged lower, though trading will be light with holidays in the U.S., U.K. and Singapore. The U.S. should give up its “wishful thinking” of changing China, Chinese Foreign Minister Wang Yi said, warning that American leaders are potentially pushing toward a new Cold War. All eyes will be on equities in Hong Kong, where riot police clashed with protesters marching against China’s move to crack down on dissent. Stocks there fell more than 5% Friday. S&P 500 futures were flat after U.S. shares rallied into Friday’s close, when Asia equity futures climbed. Oil dipped.On the virus front, Japan’s government will lift the state of emergency in Tokyo and its surrounding regions along with Hokkaido on Monday, NHK reported. The U.S. is considering restricting travel from Brazil, which now has the second-highest number of cases.Fresh turmoil in Hong Kong that spilled over into street protests this weekend is threatening to damage an already souring Sino-U.S. relationship. It risks hurting sentiment and choking a rally that’s left global equities about 30% higher than the March lows, spurred by stimulus measures and optimism for a swift rebound from the virus.“One big threat to the recovery in markets is the escalating war of words between the U.S. and China,” said Shane Oliver, head of investment strategy at AMP Capital Investors Ltd. in Sydney. “The main focus will likely remain on continuing evidence that the number of new Covid-19 cases is slowing in developed countries, progress towards medical solutions, the reopening of economies and signs that economic activity is picking up.”Here are some key events coming up:U.S. markets are closed Monday for Memorial Day holiday, while the U.K. is shut for the Spring bank holiday.Earnings continue with companies including Nissan Motor, British Land, Royal Bank of Canada and HP Inc.Singapore’s parliament on Tuesday is expected to announce another stimulus package.Thursday brings the U.S. jobless claims reading for the week ended May 23.Federal Reserve Chairman Jerome Powell participates in a virtual discussion on Friday.These are the main moves in markets:StocksFutures on the S&P 500 were little changed as of 7:03 a.m. in Tokyo. The gauge rose 0.2% on Friday.Futures on Japan’s Nikkei 225 advanced 0.2%.Hang Seng futures climbed 0.4% on Friday, when futures on Australia’s S&P/ASX 200 Index added 1.2%.CurrenciesThe yen was at 107.63 per dollar.The offshore yuan dipped 0.1% to 7.1537 per dollar.The euro bought $1.0897.The Aussie slid 0.1% to 65.32 U.S. cents.BondsThe yield on 10-year Treasuries fell one basis point to 0.66% on Friday.CommoditiesWest Texas Intermediate crude fell 0.8% to $33.01 a barrel.Gold dipped 0.1% to $1,732.59 an ounce.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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  • My ASX share for the week

    Soul Patts share price

    My ASX share for the week is Washington H. Soul Pattinson and Co. Ltd (ASX: SOL).

    The share price of Soul Patts is currently down by 21% compared to where it was before the coronavirus smashed the market. Some quality ASX shares have actually completely recovered to where they were before. Soul Patts isn’t there yet.

    The investment conglomerate is a regular favourite pick of mine, but it’d be my ASX share pick for the week for two key reasons over the next few days.

    TPG Telecom Ltd (ASX: TPM) merger continues

    TPG is one of the largest telecommunication companies in Australia and it’s about to get even bigger when it merges with Vodafone Australia. The two telcos have been trying to merge for some time. They were finally victorious in court against the ACCC and are moving forward.

    The date has now been set for the shareholder vote to merge the two telcos – 24 June 2020. Not only will the merger bring together two complementary businesses with combined infrastructure, but it will lead to a large special dividend to TPG shareholders such as Soul Patts.

    The certainty of the merger going ahead should be a boost for the TPG share price and therefore the Soul Patts portfolio too.  

    Soul Patts is my ASX share of the week because it has stood the test of time

    Soul Patts has been listed on the stock exchange since 1903. Think of all the things it has already survived through. Wars, recessions and other global infections like the Spanish Flu.

    I think Soul Patts offers more security than most other businesses and most other types of investments. It’s built to last for decades. That’s why it’s my ASX share for the week and indeed for the decades ahead. 

    I believe it has a safe balance sheet, with long-term focused investments and a pleasing, growing dividend. I think the Milners and CEO Todd Barlow are very aligned with their share holdings.

    As Soul Patts increases its diversification with more investments, such as a planned partnership into regional data centres, it makes me even more confident about Soul Patts’ future.

    Foolish takeaway

    Soul Patts is my ASX share for the week. I plan to be a very long-term shareholder. The Soul Patts share price looks very good to me today, which is why I’d buy some more this week after the positive TPG news.

    Soul Patts isn’t the only share I’d love to buy this week for my portfolio. I’ve also got my eyes on these top ASX shares.

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    One is a diversified conglomerate trading 40% off it’s all-time high, all while offering a fully franked dividend yield of over 3%…

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    Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Washington H. Soul Pattinson and Company Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

    The post My ASX share for the week appeared first on Motley Fool Australia.

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