I think it’s fair to say that 2020 has been a bad year for dividends. Due to the pandemic, a large number of popular dividend shares have had to defer or cancel their dividends.

While this is disappointing, I’m confident that most dividend payments will resume again next year. In light of this, now could be a good time to look at the dividend shares to own in 2021 and beyond.

Here are two dividend shares I think should be considered:

Stockland Corporation Ltd (ASX: SGP)

Stockland is a property company which owns, manages and develops a diverse range of property assets. These include retirement villages, retail centres, business parks, offices, and logistics centres. Its shares have been hit very hard during the pandemic and are now down almost 50% from their 52-week high. I think this has left them trading at bargain prices for income investors. I’m not the only one that thinks this.

A recent note out of Goldman Sachs reveals that it has a buy rating and $4.43 price target on Stockland’s shares. It has been running the rule over the company and expects it to pay a distribution of ~26 cents per share in FY 2021. This equates to a whopping 9.2% distribution yield.

Sydney Airport Holdings Pty Ltd (ASX: SYD)

The Sydney Airport share price is down 41% from its 52-week high. Investors have of course been selling the airport operator’s shares after travel restrictions left its runways and terminals virtually empty. The good news is that Australia is now reopening and over the coming months Sydney Airport will start to see a recovery in domestic passenger numbers. While a full domestic recovery will take time and international tourism will take even longer, the company looks well-placed to pay a dividend in FY 2021.

Another recent note out of Goldman Sachs reveals that it expects Sydney Airport to pay a 29 cents per share dividend in FY 2021 and then a 37 cents per share dividend in FY 2022. If this proves accurate, it means that the company’s shares offer 5.3% and 6.7% yields, respectively, over the next couple of years. I think this is achievable and makes it well worth being patient with its shares.

More reading

• Why this overlooked ASX 200 stock just got upgraded by 3 leading brokers to “buy”
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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.

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The Australian Bureau of Statistics (ABS) released the third Household Impacts of COVID-19 Survey today, conducted throughout the country between 29 April and 4 May 2020.

According to the ABS, the series is designed to provide a snapshot of how people in Australian households are faring in response to the social and economic challenges brought about by COVID-19.

The third survey collected data relating to changes to people’s job situation, working from home arrangements, personal and household stressors, and lifestyle changes, among other topics.

The results of the survey were taken from telephone interviews conducted with around 1,000 Australian households.

Key findings

On the lifestyle front, the survey highlighted changes to people’s daily routines in the period of late April to early May:

• 22% said they were eating more snack foods, such as chips, lollies and biscuits
• 58% said they were spending more time in front of their television, computer, phone, or other devices
• 29% reported less frequent consumption of takeaway or delivered meals
• 38% said they were spending more time baking or cooking.

Additionally, 21% of people reported purchasing additional household supplies, which was much lower than the 47% recorded in April. This is in line with announcements from our major ASX supermarkets Coles Group Ltd (ASX: COL) and Woolworths Group Ltd (ASX: WOW) that trading is beginning to return to normal levels. As such, both companies have resumed home delivery services.

While ASX supermarket shares have been the beneficiaries of people cooking more at home, so too has meal kit provider Marley Spoon AG (ASX: MMM). The company, which delivers fresh ingredients and recipes to customers’ doors, has reported a surge in demand amid COVID-19.

In terms of employment, the survey found that 46% of working Australians were working from home, while 59% of respondents were working paid hours as of early May. 

The survey also found that loneliness was the most widely reported source of stress for Australians, affecting 22% of the sample, with other factors such as relationship difficulties and mortgage repayment difficulties reported as further stressors.

Importantly, the majority of Australians were continuing to keep their distance from people outside of their household (94%) and avoid public spaces (85%). The most common reasons for leaving the house were shopping for food (88%) and exercising or walking pets (73%).

What next?

This data provides some insight into how a sample of Australian households have been dealing with COVID-19 and the associated restrictions. 

The ABS followed up with the same survey respondents again on 12 May to undertake the fourth cycle of the survey. Topics include superannuation, loan repayments, childcare and schooling arrangements, and temporary living arrangements.

From a financial and investing perspective, the findings relating to superannuation will be one to watch in the wake of the government’s early access to super scheme.

The information from this fourth survey will be released later this month on 29 May 2020.

More reading

• Why is the Woolworths share price flat for 2020?
• ASX 200 Weekly Wrap: Gold miners help edge ASX ever higher
• How this $70m ASX small cap is cutting down a $50bn industry
• 5 things to watch on the ASX 200 on Monday
• ASX shares that could benefit from the Internet of Food

Motley Fool contributor Cathryn Goh has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of COLESGROUP DEF SET and Woolworths 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.

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The coronavirus pandemic saw shoppers flock to supermarkets around Australia to panic buy essentials and non-discretionary items. Despite the surge in consumer demand, the share price of Australia’s largest supermarket retailer, Woolworths Group Ltd (ASX: WOW), remains flat for the year.

So, is the Woolworths share price a long-term bargain and should you buy?

How has Woolworths performed?

Late last month, Woolworths reported its strongest quarterly sales growth in more than a decade. The group’s sales surged more than 10% to $16.5 billion for the quarter, with supermarket sales rising more than 40% in the week ending March 22. Long-life items such as toilet paper, pasta, flour and bread mixes fuelled sales growth as consumers rushed to stock up their pantries.

Woolworths saw total sales within its Endeavour Drinks business rise 9.5% for the quarter to $2.25 billion. Boasting brands such as Dan Murphy’s and BWS, Endeavor Drinks reported a surge in sales as consumers stocked up on takeaway liquor amid fears surrounding lockdown restrictions.

All of this should have been a boost for the Woolworths share price. However, following the federal government’s response to the coronavirus pandemic, the company closed the operations of its Hotels business in late March and, as a result, sales dropped more than 12% for the quarter.

$5 million boosts from Marley Spoon

Woolworths has also made a handy profit from its stake in subscription-based meal kit provider Marley Spoon AG (ASX: MMM). The Marley Spoon share price has surged around 400% since mid-March as the company enjoyed a boom in demand for at-home meal consumption.

As a result, according to the Australian Financial Review (AFR), Woolworths stands to make approximately $5 million in profit from its stake in the meal box delivery service. In 2019, Australia’s largest retailer invested $30 million in Marley Spoon through a debt and equity transaction. The deal issued Woolworths with 8.2 million in ASX-listed chess depositary notes in Marley Spoon at 50 cents each.

Why is the Woolworths share price flat?

Despite strong sales growth in its supermarket and liquor divisions, as well as profit from its stake in Marley Spoon, Woolworths has also incurred increased costs. According to the company’s management, increased costs for wages, security, supply chain and e-commerce will partially offset sales growth.

In order to satisfy consumer demand whilst also maintaining social distancing measures, Woolworths saw costs soar between $70 million and $90 million in March. These costs are expected to increase to a range of between $220 million and $275 million for the June quarter as Woolworths looks to prepare itself for future trading amid a potential second wave of the pandemic.

Should you buy?

The Woolworths share price is currently trading on a price-to-earnings ratio of around 27 times future earnings, which could prompt some investors to assess the stock as being too expensive. In my opinion, even though Woolworths has seen a surge in costs and substantial losses in its hotel business, the company’s share price still looks attractive for long-term growth.

There are, however, many moving parts in the short term, given the uncertain trading environment resulting from the coronavirus pandemic. For this reason, I think a prudent strategy would be to see how Woolworths handles future costs before making an investment decision.

More reading

• Latest ABS data reveals how Australians are responding to COVID-19
• ASX 200 Weekly Wrap: Gold miners help edge ASX ever higher
• How this $70m ASX small cap is cutting down a $50bn industry
• ASX shares that could benefit from the Internet of Food
• 4 top ASX 200 shares for blue chip investors

Motley Fool contributor Nikhil Gangaram has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Woolworths 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.

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