I think one of the best times to invest in a leading ASX dividend stock is when the business has fallen significantly. That’s because of the compelling dividend yield that it can unlock. The business WAM Microcap Ltd (ASX: WMI) is one of the leading dividend picks out there, in my view.

When a share price falls, it delivers a similar boost to the yield. For example, if an investment has a 5% dividend yield and the share price falls 10%, then the yield becomes 5.5%.

I believe WAM Microcap is a compelling investment today because it’s down 35% since October 2021 and 22% from October 2025.

Let’s get into why it’s a compelling buy today for passive income.

Exciting investment strategy

This business is a listed investment company (LIC). WAM Microcap aims to give investors exposure to a portfolio of undervalued ASX microcap shares (the majority of which are growth companies), with a market capitalisation of less than $300 million at the time of acquisition.

WAM Microcap can also provide exposure to “relative value arbitrage and market mispricing opportunities”.

The ASX dividend stock’s main sector focus is industrial shares, which gives it a large hunting ground, though at the end of July 2026 it also had a portfolio double-digit exposure to consumer discretionary, financials and IT stocks.

Investing in small-cap stocks can deliver strong returns because they are earlier in their growth journeys than blue-chip stocks. These businesses are often under-researched by analysts and, as a result, can be mispriced.

Since inception in June 2017, its portfolio has returned an average of 13.1% per year (before fees, expenses and taxes), doubling the return of its benchmark in that time.

Large dividend yield

One of the benefits of the LIC structure is that it enables the investment returns to be turned into a smoothed dividend. Excellent returns in one year can be accumulated to help pay for the dividend in a weak year.

The ASX dividend stock recently announced its FY26 annual dividend. It represents a very large annual dividend yield, which is a pleasing way to receive returns.

In FY26, its annual payout of 10.7 cents per share equates to a grossed-up dividend yield of 10.75%, including franking credits.

Rising payouts

Perhaps what’s even more important to me is that WAM Microcap has provided a very reliable dividend over the years.

It started paying a dividend in FY18, and that dividend has grown every year since then, aside from FY24, when it was maintained. The FY26 payout was only increased by 1%, but when you’re talking about a double-digit dividend yield already, any increase is pleasing.

I think this is a great time to invest in the ASX dividend stock for passive income.

The post 1 ASX dividend stock down 35% I’d buy right now appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Wam Microcap. 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Alkane Resources Ltd (ASX: ALK) share price is in focus after the company announced the discovery of a new high-grade gold and antimony domain at its Costerfield site, alongside impressive drilling results from the Sub-KC area with gold grades reaching up to 580.9 grams per tonne.

What did Alkane Resources report?

• 23 new diamond drill holes in the Cuffley infill area revealed a new pod of high-grade gold and antimony.
• Significant intercepts at Cuffley included 580.9g/t gold and 24% antimony over 0.61m, and 168.9g/t gold and 33.5% antimony over 0.9m.
• 17 additional holes targeted the Sub-KC domain, with notable results such as 192g/t gold over 0.17m and 73.2g/t gold over 0.19m.
• The new Cuffley pod is accessible from existing mine infrastructure and will be integrated into the mine schedule.
• Further drilling at depth explored structural repetitions and growth potential at Sub-KC.

What else do investors need to know?

This new high-grade discovery sits in an area previously believed to be low-grade due to a crosscutting fault, emphasising the value of challenging established geological models. The Cuffley pod’s ease of access from current mine workings means it can be quickly added to production plans.

Additional intercepts in the Sub-KC system point to continued prospectivity, with target-testing holes beginning to test for further ‘repeats’ of the structural setup that hosts gold and antimony mineralisation.

What did Alkane Resources management say?

Alkane Resources’ CEO, Nic Earner, commented:

This discovery of unmined high-grade material directly adjacent one of Costerfield’s top-shelf historical orebodies showcases the importance of Alkane’s directive of revisiting and challenging old models and preconceptions surrounding mineralisation to extract value. We will continue seeking this new mineralisation alongside generating new targets within our leases.

What’s next for Alkane Resources?

The newly identified Cuffley pod will be incorporated into the Costerfield mine plan and is scheduled for production. Alkane sees significant growth potential in the Sub-KC domain, though further drilling will likely require surface-based programs or later mine development to reach optimal angles.

Ongoing exploration across the company’s Australian and Swedish assets continues to expand resources, supporting Alkane’s growth strategy as a mid-tier gold and antimony producer.

Alkane Resources share price snapshot

It has been a strong 12 months for the Alkane Resources share price. During this time, the gold miner’s shares have outperformed the S&P/ASX 200 index (ASX: XJO) with a gain of over 80%.

View Original Announcement

The post Alkane Resources discovers new high-grade gold zone at Costerfield appeared first on The Motley Fool Australia.

More reading

• Alkane Resources declares maiden dividend and $50m share buy-back after strong FY26

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

The L1 Gold Fund Ltd (ASX: LGF) share price came into focus today after the company released its inaugural FY26 results.

What did L1 Gold Fund report?

• Loss after income tax: $71.1 million (first reporting period since IPO)
• Total investment losses: $92.5 million
• Portfolio net return: -10.90% (April to June 2026)
• No dividends declared or paid during the period
• Net tangible asset backing per share (post-tax): $1.8482
• Basic and diluted loss per share: 14.97 cents

What else do investors need to know?

L1 Gold Fund officially listed on the ASX in April 2026, raising $950 million in its IPO. The first reporting period coincided with a sharp 17% decline in the gold price, driven by geopolitical tensions, shifting interest rates, and heavy defensive selling.

Despite a challenging debut, the Investment Manager used active stock selection and hedging strategies, such as a physical gold short position, to cushion portfolio performance relative to sector declines. Management capitalised on the sector sell-off by adding high-conviction, mid-cap gold producers and late-stage developers to the portfolio.

On 24 August 2026, the company announced a capital raising comprising a non-underwritten placement of up to $160 million and a 1-for-3 non-renounceable entitlement offer at $2.25 per share. This offer remains open, with completion pending further updates.

What did L1 Gold Fund management say?

Chairman Andrew Larke said:

In an exceptionally volatile environment for gold and mining equities, our portfolio return of -10.90% compared to a decline of nearly 20% for the sector reflects the resilience of our investment strategy. While the initial period of performance is disappointing, we remain confident in the long-term opportunity for quality gold equities. We thank shareholders for their ongoing support and patience.

What’s next for L1 Gold Fund?

The company’s investment manager remains optimistic about the longer-term case for gold and quality gold equities, with ongoing central bank buying and elevated geopolitical risks expected to support the gold price. The current capital raise is aimed at expanding the portfolio to capture what management views as compelling valuations across mid-cap producers and late-stage developers.

L1 Gold Fund plans to maintain its focus on strong research, portfolio discipline, and active risk management to navigate further market volatility. The next Annual General Meeting will be held on 10 November 2026.

L1 Gold Fund share price snapshot

Over the past 12 months, L1 Gold Fund shares have risen 19%, outperforming the All Ordinaries Index (ASX: XAO), which is flat over the same period.

View Original Announcement

The post L1 Gold Fund posts debut FY26 result and capital raise update appeared first on The Motley Fool Australia.

More reading

• GemLife beats forecasts and upgrades FY26 guidance
• Ampol profit and dividend surge in first-half 2026 results
• 1 ASX dividend stock down 35% I’d buy right now
• Alkane Resources discovers new high-grade gold zone at Costerfield
• Ventia Services Group delivers higher profit and fully-franked dividend in HY26

Motley Fool contributor Laura Stewart has no position in any of the stocks mentioned. 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.