Do you want to generate $1,000 a month in dividends? I believe it’s totally possible for your portfolio. You just have to remained disciplined and choose the right ASX shares.

Dividends are great

I think that dividends from ASX shares are great. It’s wonderful that we can get paid by our investments for no effort, except the initial investment.

Businesses can pay out dividends (or distributions) from their annual profits and retain some of the profit to re-invest for more growth.

I think it’s a good idea for most Australian companies to pay out a dividend. It’s nice for shareholders to receive cash payments just being part owners of the business. Some high growth businesses may need all of the available capital to fund growth, but larger businesses don’t need to retain all of their cashflow. 

Franking credits

Australian companies get particular advantages for making taxable profit in Australia. The country does have a relatively high company tax rate, however all corporate income tax paid can be used as a refundable tax credit (called franking credits) for Australian tax residents. Franking credits reduce the taxes owed by taxpayers who receive dividends. For some low income earners and retirees it can mean the entire franking credit amount being refunded to investors when they do their tax return.

Franking credits can turn a $70 dividend into a $100 grossed-up dividend after the tax return is completed.

Which ASX dividend shares are good ideas?

Different investors will have different opinions about which ASX shares are good ideas for income.

Some people are just attracted to large ASX blue chips which are seemingly safe dividend ideas like Wesfarmers Ltd (ASX: WES), Coles Group Limited (ASX: COL) and BHP Group Ltd (ASX: BHP).

However, as this COVID-19 period has shown, I don’t think some businesses can be relied on as dividend ideas because they’re not that defensive.

Below are some of my favourite ideas. Before I get into it, I just want to tell you that a listed investment company (LIC) is a company which invests in other businesses on behalf of shareholders. Here are my ideas for an ASX dividend share portfolio:

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) has a grossed-up dividend yield of around 4%. It’s a diversified investment conglomerate.

Brickworks Limited (ASX: BKW) has a grossed-up dividend yield of 4.4%. It is a diversified property business.

Future Generation Investment Company Ltd (ASX: FGX) has a grossed-up dividend yield of 6.6%. It’s a philanthropic, diversified LIC.

WAM Microcap Limited (ASX: WMI) has a grossed-up dividend yield of 5.6%. It’s a LIC which invests in small caps.

Rural Funds Group (ASX: RFF) has a FY21 distribution yield of 4.7%. It’s a farmland real estate investment trust (REIT).

Magellan Global Trust (ASX: MGG) aims for a 4% distribution yield. It’s a globally-focused listed investment trust (LIT).

WAM Leaders Ltd (ASX: WLE) has a grossed-up dividend yield of 8%. It’s a LIC which focuses on large cap ASX shares.

If you bought an equal amount of each of the above ASX dividend shares your portfolio would be very diversified and it would have a grossed-up dividend yield of 5.3%.

What size portfolio would you need with a 5.3% yield to make $1,000 a month in dividends?

The dividend yield of your portfolio dictates how much income you’d make from it. If you had a $100,000 portfolio with a 10% dividend yield then you’d receive $10,000 of dividends a year.

If you had a $200,000 portfolio with a 5% yield it would pay $10,000 a year.

You’d need a portfolio worth $226,415 with a 5.3% grossed-up yield to get $1,000 a month, or $12,000 a year.

Of course, not many people have almost a quarter of a million dollars sitting around in cash to invest into shares. It takes saving, investing and compounding to reach that type of wealth. According to the Moneysmart calculator, it would take less than 11 years by investing $1,000 a month into ASX shares to reach a portfolio size of $230,000 if it compounded at 10% a year.

Of course, your portfolio could reach $230,000 faster if you invested more per month or identified investments better than the overall market (which is still a good wealth builder).

More reading

• 2 high yield ASX dividend shares to buy next week
• Is it time to save more or invest more in ASX shares?
• Why I think the Brickworks (ASX:BKW) share price is a buy
• 4 reasons why Rural Funds (ASX:RFF) is a great ASX dividend share
• 2 outstanding ASX 200 shares for your retirement portfolio

Motley Fool contributor Tristan Harrison owns shares of FUTURE GEN FPO, MAGLOBTRST UNITS, RURALFUNDS STAPLED, WAM MICRO FPO, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Brickworks, RURALFUNDS STAPLED, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of COLESGROUP DEF SET and 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.

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It was a mildly positive week for the S&P/ASX 200 Index (ASX: XJO) last week. After a number of ups and downs, the benchmark index recorded a 0.1% gain to end it at 5,864.5 points.

A number of shares climbed more than most last week. Here’s why these were the best performers on the ASX 200 over the period:

Perseus Mining Limited (ASX: PRU)

The Perseus share price was the best performer on the ASX 200 last week with a sizeable 14.2% gain. This appears to have been triggered by a broker note out of Credit Suisse. Its analysts upgraded Perseus’ shares to an outperform rating with an improved price target of $1.60 after lifting their gold price forecasts to US$2,500 an ounce in 2021. This appears to have rubbed off on other gold miners, leading to the top four performers coming from the sector. Northern Star Resources Ltd (ASX: NST), Silver Lake Resources Limited (ASX: SLR), and Evolution Mining Ltd (ASX: EVN) round out the top four. This strong form led to the S&P/ASX All Ordinaries Gold index climbing a sizeable 7.4% over the five days.

Perenti Global Ltd (ASX: PRN)

The Perenti share price was the next best performer with a gain of 11% last week. Investors were buying the mining services company’s shares after it announced a major contract extension for its hard-rock underground miner business, Barminco. It has signed an 18 month extension at MMG’s Dugald River mine in North Queensland. Management estimates that it is worth $140 million.

Eagers Automotive Ltd (ASX: APE)

The Eagers Automotive share price wasn’t far behind with a 10.5% gain over the five days. Last week the automotive retailer announced plans to spend $105 million to buy eight car yards from property trust Charter Hall Group (ASX: CHC). The capital for the purchases is being provided by Toyota Financial Services ($175 million) and Volkswagen Financial Services ($50 million).

Blackmores Limited (ASX: BKL)

The Blackmores share price was on form and pushed 9.7% higher over the period. This was despite there being no news out of the health supplement company. However, prior to last week, its shares were down more than a third form their 52-week high. Some investors may believe they had been oversold.

More reading

• These were the worst performing ASX 200 shares last week
• ASX 200 drops 0.3%, gold miners keep rising
• Why the Beach Energy (ASX:BPT) share price is outperforming its peers today
• Why the Purifloh (ASX:PO3) share price crashed to a 2-year low today
• Why the St Barbara (ASX:SBM) share price is climbing higher today

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Blackmores 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 These were the best performing ASX 200 shares last week appeared first on Motley Fool Australia.

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Unfortunately for income investors, it looks increasingly likely that interest rates will stay at close to zero for a number of years to come.

The good news is that there are alternatives to term deposits and savings accounts. At present, there are a number of shares on the Australian share market offering investors generous yields.

Here are two ASX dividend shares I would buy:

Aventus Group (ASX: AVN)

The first ASX dividend share to buy is Aventus. While retail property might not be something you would think to invest in right now, I would suggest you reconsider this. Aventus is a very different beast to other retail properties companies. It owns and operates 20 large format retail parks across Australia. Positively, these centres have a high weighting towards everyday needs. It counts major retailers such as ALDI, Bunnings, Officeworks, and The Good Guys among its 593 tenancies.

This weighting has proven to be a very positive thing during the pandemic and allowed Aventus to collect the vast majority of its rent as normal in FY 2020. This led to the company reporting a 4.2% increase in funds from operations (FFO) to $100 million. I’m expecting a similarly solid year in FY 2021. Based on this and the current Aventus share price, I estimate that it offers a generous 5% yield.

Rural Funds Group (ASX: RFF)

Another dividend share which has continued its positive form this year is Rural Funds. It is a real estate investment trust that owns a diversified portfolio of high quality agricultural assets across Australia. This includes macadamia orchards, cattle assets, cotton assets, vineyards, and almond orchards. These assets are leased to some of the most experienced agricultural operators in the country such as Treasury Wine Estates Ltd (ASX: TWE) and Select Harvests Limited (ASX: SHV). 

In FY 2020, Rural Funds delivered an 8% increase in property revenue to $72 million. This allowed the company’s board to increase its distribution by its target rate of 4% per annum. Pleasingly, more of the same is expected in FY 2021 thanks to its long term tenancy agreements and periodic rent increases. Management intends to increase its distribution by 4% again to 11.28 cents per share. Based on the latest Rural Funds share price, this equates to a 4.7% yield.

More reading

• 4 reasons why Rural Funds (ASX:RFF) is a great ASX dividend share
• 3 retirement myths you can’t afford to believe
• Not sure about Westpac (ASX:WBC)? Buy these ASX dividend shares instead
• Why I would buy Telstra (ASX:TLS) and this ASX dividend share
• ASX dividend shares raising their dividends like clockwork

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED and Treasury Wine Estates Limited. The Motley Fool Australia has recommended AVENTUS RE UNIT. 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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Even for seasoned investors, right now is a tough time to invest more in ASX shares. 

We saw the market freefall in the March bear market as concerns over the coronavirus pandemic took hold. However, the market has rebounded strongly and some shares like Afterpay Ltd (ASX: APT) have gone bananas.

It’s tempting to sit on the sidelines and accumulate more cash, but is it really a good strategy right now?

Why it’s time to invest more in ASX shares

I will preface this by saying that it is assumed that the choice is between saving cash to invest later, or investing more today.

Most investors know that market timing, trying to pick the bottom of the market, is not a good strategy. However, even many of those who know this can’t help but sit on cash right now.

It’s definitely a scary time to invest, with the economy being propped up by government stimulus and cheap central bank money. There are concerns about recessions and unemployment hampering future growth.

But the thing is, even the world’s worst market timer who consistently buys before a crash still generally outperforms those that try to time the market bottom.

I think buying high-quality ASX shares is a long-term game. If you look at a 30-year share price chart, March 2020 will just be a small blip on the radar.

The real question for market timers is when do you jump back in. It’s easy to wait, but the reality is that it’s even scarier to buy ASX shares in the depths of market declines like we saw in March.

That’s why I think buying today is almost always a better strategy provided there is some sense to it. That means staying diversified across a number of companies and maybe even tilting portfolios towards downside protection.

Investments in non-cyclical companies like Coles Group Ltd (ASX: COL) or defensive shares like Newcrest Mining Limited (ASX: NCM) are the sort of things I’m looking for at the moment.

Foolish takeaway

It’s easy to sit on the sidelines accumulating cash to “invest when the market corrects”. No one knows when the next crash will be, and as the saying goes, “time in the market beats timing the market”.

That’s why I think a consistent buying strategy across a number of high-quality ASX shares can help build long-term wealth.

More reading

• ASX 200 down 0.1%: Tech shares push higher, AMP (ASX:AMP) sinks lower
• Why the Afterpay (ASX:APT) share price could be a buy
• Are ASX gold shares like Newcrest (ASX:NCM) still good value?
• 5 things to watch on the ASX 200 on Friday
• ASX 200 drops 1.2%, Mineral Resources (ASX:MIN) fell 9%

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO and COLESGROUP DEF SET. 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 S&P/ASX 200 Index (ASX: XJO) had a number of ups and downs last week but ended with a small weekly gain. The benchmark index rose 0.1% to 5,864.5 points.

Not all shares were able to climb higher with the ASX 200 last week. Here’s why these were the worst performers over the five days:

Cleanaway Waste Management Ltd (ASX: CWY) 

The Cleanaway share price was the worst performer on the ASX 200 last week with a 13.5% decline. Investors were heading to the exits in their droves after the waste management company confirmed reports of poor workplace behaviour by its CEO, Vik Bansal. Cleanaway launched an internal investigation and will implement a range of measures. These include executive leadership mentoring, enhanced reporting, and monitoring of the CEO’s conduct. Mr Bansal has also been given a final warning.

Unibail-Rodamco-Westfield (ASX: URW)

The Unibail-Rodamco-Westfield share price was out of form last week and dropped a sizeable 10.5% lower over the five days. This appears to have been triggered by the announcement of the shopping centre operator’s reset plan. Its deleveraging plan includes a fully underwritten 3.5 billion euro capital raising which will be used to pay down its debt obligations.

AMP Limited (ASX: AMP)

The AMP share price wasn’t far behind with a 9.1% decline last week. This decline was attributable to the financial services company’s shares trading ex-dividend on Friday. AMP is paying a fully franked 10 cents per share interim dividend. Eligible shareholders can look forward to receiving this dividend on 1 October.

Virgin Money UK (ASX: VUK)

The Virgin Money UK share price was a poor performer and tumbled 8.1% lower last week. This decline could be due to the UK based bank being removed from the S&P/ASX 100 Index next Monday. I suspect index tracking funds and fund managers with strict investment mandates may have been offloading shares ahead of its exclusion.

More reading

• These were the best performing ASX 200 shares last week
• ASX 200 drops 0.3%, gold miners keep rising
• Why the Beach Energy (ASX:BPT) share price is outperforming its peers today
• Why the Purifloh (ASX:PO3) share price crashed to a 2-year low today
• Why the St Barbara (ASX:SBM) share price is climbing higher today

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 S&P/ASX 200 Index (ASX:XJO) dropped by 0.3% today, declining to 5,864 points.

Gold miners rise again

Over the past couple of weeks the share prices of ASX 200 gold miners have been rising as other shares like the FAANG stocks have dropped.

Looking at today’s ASX 200 movements:

The Saracen Mineral Holdings Limited (ASX: SAR) share price went up 4.2%, the Perseus Mining Limited (ASX: PRU) share price rose by 3.3%, the Evolution Mining Ltd (ASX: EVN) share price grew 1%, the Gold Road Resources Ltd (ASX: GOR) share price rose by 3%, the Resolute Mining Ltd (ASX: RSG) share price climbed 1%, the St Barbara Ltd (ASX: SBM) share price rose 1.5% and the Silver Lake Resources Ltd (ASX: SLR) share price rose 2.9%.

Today’s biggest declines

The share price of AMP Limited (ASX: AMP) dropped by 8% today after it went ex-dividend with its special dividend. It was the worst performer in the ASX 200.

There were other large declines with the Unibail-Rodamco-Westfield CDI (ASX: URW) share price falling 7.3%, the Abacus Property Group (ASX: ABP) share price dropped 4.3%, the Virgin Money UK CDI (ASX: VUK) share price declined 4.1% and the Qube Holdings Ltd (ASX: QBE) share price fell 2.6%.

Clover Corporation Limited (ASX: CLV)

The Clover share price fell over 8% today after reporting its FY20 result.

Sales revenue increased by 15.1% to $88.3 million. Management said that there was growth across all of its markets. The Australian, New Zealand and Asian markets continued to show growth, driven by infant formula demand and increased interest in the health benefits of omega 3 fatty acids resulting in new customers creating new products for the food and nutraceutical sectors.

Clover said the European Union market has grown substantially as new and existing infant formula manufacturers adjust their formulations to meet the new EU standard for infant formula since February 2020. The leadership said the USA has shown promising growth, with many projects on hold due to COVID-19 impacts.

Clover’s earnings before interest, tax, depreciation and amortisation (EBITDA) rose by 35% to $18.9 million, net profit before tax rose by 26% to $17.7 million and net profit after tax jumped 23.8% to $12.5 million. Earnings per share (EPS) increased by 22.7% to 7.51 cents.

The ASX share’s board decided to increase the final dividend by 5% to 2.5 cents

Clover said it benefited from pantry stocking during the third and fourth quarter of FY20. Though it’s seeing demand normalise now.

The company said its balance sheet remains strong with net debt of $5.4 million.

Clover also explained that it invested in a new company called Melody Dairies in 2019 which has built a new nutritional spray dryer in New Zealand during 2020. Clover owns 42% of the company and has access to 42% of its capacity to manufacture its products.

The construction of the spray dryer is complete with qualification trials progressing well. However, customer audits have been impacted by COVID-19 preventing travel, which will slow production volume initially.

Fonterra Shareholders’ Fund (ASX: FSF)

Fonterra reported its FY20 result today to the market.

It said that it generated profit after tax of $659 million, up $1.3 billion. Normalised profit after tax came in at $382 million, up $118 million.

Group earnings before interest and tax (EBIT) was $1.1 billion, up $1.2 billion from the previous year. Fonterra generated normalised EBIT of $879 million, up $67 million.

Normalised gross profit grew by $200 million to $3.2 billion. Normalised operating expenses dropped by $14 million to $2.3 million.

Fonterra generated free cashflow of $1.8 billion, up $733 million. This helped reduce net debt by $1.1 billion over the year to $4.7 billion.

Fonterra Chair John Monaghan said: “This year marks a return to paying dividends, a position we expect to maintain in the future, assuming normal operating conditions.

“At 5 cents per share, the dividend is at the lower end of the 5 cent to 7 cent range calculated under the board’s dividend policy guidelines.”

In FY21, Fonterra is expecting earnings to be between $0.20 per share to $0.35 per share. For context, FY20 earnings per share (EPS) was $0.24. The business reaffirmed its FY21 farmgate milk price range of $5.90 per kgMS to $6.90 per kgMS.

More reading

• Why the Beach Energy (ASX:BPT) share price is outperforming its peers today
• Why the Purifloh (ASX:PO3) share price crashed to a 2-year low today
• Fonterra Shareholders’ Fund (ASX:FSF) share price higher after annual result
• Why the St Barbara (ASX:SBM) share price is climbing higher today
• ASX 200 down 0.1%: Tech shares push higher, AMP (ASX:AMP) sinks lower

Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Clover Limited. 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 Cardiex Ltd (ASX: CDX) share price was rising today as the company announced it had received a new blood pressure patent. The Cardiex share price closed today’s trading 6.12% higher at 5.2 cents.

What Cardiex does

Cardiex is a global health technology company that focuses on hypertension, cardiovascular disease, and other vascular health disorders.

The company’s ATCOR division develops medical devices for measuring arterial stiffness and central blood pressure waveforms based on its unique FDA-cleared and patented technology.

Under the ATCOR.X brand, the company also develops and licenses its Arty platform consisting of physiological and health analytics for wearable devices. The company’s digital platform, ArtyNet, is a connected software-as-a-service (SaaS) ecosystem providing physicians with a complete telehealth solution for remotely managing patients’ health (2021 launch).

Cardiex gets blood pressure patent

It was announced this afternoon that Cardiex’s subsidiary, ATCOR, has been granted a new patent by the European Patent Office. The patent is in relation to the intellectual property (IP) for the Company’s proprietary SphygmoCor technology used in cuff-based blood pressure devices.

The patent protects the company’s IP in relation to the measurement of a whole central blood pressure waveform with cardiovascular features using a brachial cuff. It also covers non-invasively estimating the heart’s pressure with features related to cardiac function and arterial properties using a conventional blood pressure cuff inflated to low pressure.

CEO and Managing Director of Cardiex, Craig Cooper, commented:

We are very pleased to be granted this new patent to protect our IP in Europe. Of great significance is the findings of the examining officers from the EPO which were similar to the findings we received from examiners in the US in 2016 – that there are substantial differences in respect of any other existing patents – further demonstrating and validating the uniqueness of our technology.

What now for the Cardiex share price?

This represents a significant step forward for the company in protecting its IP in Europe. Its SphygmoCor technology has over 4500 installations worldwide. Furthermore, the technology is used by major pharmaceutical companies and research institutions such as GlaxoSmithKline plc (NYSE: GSK), AstraZeneca plc (NYSE: AZN) and Bayer AG (ETR: BAYN).

The Cardiex share price is currently trading 73.33% higher so far this year.

More reading

• ASX 200 drops 0.3%, gold miners keep rising
• Aussies trading this US share 5700% more than Uber
• 5G Networks (ASX:5GN) share price falls on takeover update
• Why the Beach Energy (ASX:BPT) share price is outperforming its peers today
• 4 words that frighten a $180 billion fund manager

Motley Fool contributor Daniel Ewing 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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