Stock Pick

  • Bitcoin Ends July at Highest Monthly Close Since 2017 Peak

    Bitcoin Ends July at Highest Monthly Close Since 2017 PeakBitcoin closed July at $11,351, according to Messari.

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  • TikTok Draws Interest From Bidders Other Than Microsoft

    TikTok Draws Interest From Bidders Other Than Microsoft(Bloomberg) — Microsoft Corp. isn’t the only company interested in buying TikTok’s U.S. operations, according to people familiar with the matter.U.S. government officials probing national-security concerns around the Chinese-owned video-sharing app have had talks with at least one other large company as well as investors in TikTok parent ByteDance Ltd. who are interested in taking a stake in TikTok, according to one of the people, who requested anonymity because the discussions are private. This person declined to identify these companies.ByteDance is considering changes to the structure of TikTok because President Donald Trump is weighing ordering a divestiture of TikTok’s U.S. business, a decision that could come at any time.Venture investors in ByteDance have approached Chief Executive Officer Zhang Yiming with a range of proposals to address U.S. concerns that the app, especially popular with teens, is a security threat, people familiar with the matter have said. Any solution would likely have to pass scrutiny from U.S. regulators in the Committee on Foreign Investment in the United States, as well as U.S. antitrust regulators.The deal provides a rare opportunity to profit off the momentum of the fastest-growing social media app in the U.S. Still, not all companies likely to be attracted to such a deal will even be in the running. TikTok’s valuation is estimated at $20 billion to $40 billion, so few companies would be able to afford it. Most of those that would are likely to find it politically difficult to make the move.The CEOs of Facebook Inc., Alphabet Inc.’s Google, Amazon.com Inc. and Apple Inc. testified this week in the U.S. House of Representatives to answer lawmakers’ questions about their enormous market power. While any one of the four companies could fit TikTok into their product offerings, deals by these giants are already under a microscope.Google, whose YouTube is a competing video offering, is already facing a European Union probe for its much smaller acquisition of Fitbit Inc. Apple doesn’t tend to make acquisitions anywhere near large as TikTok. And Facebook’s years-ago purchases of smaller rivals Instagram and WhatsApp have been brought up anew amid the antitrust scrutiny. The world’s largest social network has already worked to turn lawmakers against TikTok, and is unlikely to court further risk to its already tenuous position on data security. Facebook also looked at purchasing Musical.ly, the predecessor to TikTok, in 2016, and passed.Microsoft, with a market value of $1.55 trillion, is bigger than Google or Facebook, but currently has a better reputation in Washington. The company wasn’t invited to the antitrust hearing on July 29, and has largely escaped recent criticism of Big Tech’s outsize influence. It’s unclear whether Microsoft would seek to integrate TikTok into its own operations, or join with other investors from private equity or venture capital to finance spinning out TikTok as a separate entity based in the U.S. With the second option, investors could seek to gain even more from a TikTok stock listing in the future.Media companies, such as Walt Disney Co. and Verizon Communications Inc., have been interested in purchasing social-media assets in the past. Disney in 2016 considered but ultimately decided against purchasing Twitter Inc., for instance. TikTok’s U.S.-based CEO, Kevin Mayer, was formerly the head of streaming for Disney, and may be better positioned to help broker a deal in the media world.Other social-media companies, such as Twitter and Snapchat parent Snap Inc., have smaller valuations than TikTok and therefore are unlikely bidders. They would need to use stock or outside financial help to complete such a transaction.It’s still not clear how a U.S. divestiture of TikTok would work, and how completely the app would have to separate from its current Chinese ownership. The company hasn’t said how such a move would affect employees, the technology or its product. However the ownership shakes out, there is one group that no potential buyer or investor wants to alienate: TikTok’s 165 million American users.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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  • Nvidia in Advanced Talks to Buy SoftBank’s Chip Company Arm

    Nvidia in Advanced Talks to Buy SoftBank’s Chip Company Arm(Bloomberg) — Nvidia Corp. is in advanced talks to acquire Arm Ltd., the chip designer that SoftBank Group Corp. bought for $32 billion four years ago, according to people familiar with the matter.The two parties aim to reach a deal in the next few weeks, the people said, asking not to be identified because the information is private. Nvidia is the only suitor in concrete discussions with SoftBank, according to the people.A deal for Arm could be the largest ever in the semiconductor industry, which has been consolidating in recent years as companies seek to diversify and add scale. But any deal with Nvidia, which is a customer of Arm, would likely trigger regulatory scrutiny as well as a wave of opposition from other users.Cambridge, England-based Arm’s technology underpins chips that are crucial to most modern electronics, including those that dominate the smartphone market, an area in which Nvidia has failed to gain a foothold. Customers including Apple Inc., Qualcomm Inc., Advanced Micro Devices Inc. and Intel Corp., could demand assurances that a new owner would continue providing equal access to Arm’s instruction set. Such concerns resulted in SoftBank, a neutral company, buying Arm the last time it was for sale.No final decisions have been made, and the negotiations could drag on longer or fall apart, the people said. SoftBank may gauge interest from other suitors if it can’t reach an agreement with Nvidia, the people said. Representatives for Nvidia, SoftBank and Arm declined to comment.Divestment Drive“With Nvidia’s low-cost fabless model enabling it to focus on R&D, engineering and programming, the fit with Arm would be perfect,” said Neil Campling, an analyst at Mirabaud Securities.Nvidia is the largest maker of graphics processors and it’s spreading the use of the gaming component into new areas such as artificial intelligence processing in data centers and self-driving cars. Marrying its own capabilities with central processor units designed by Arm may enable it to take on Intel and Advanced Micro Devices in a more comprehensive way, according to Rosenblatt Securities analyst Hans Mosesmann. He estimates Nvidia would have to pay about $55 billion for Arm.“You need control of BOTH CPU and GPU roadmaps and this, of course, includes data centers,” he wrote in a note Friday, referring to central processing units and graphic processing units. “Strategically, Nvidia needs a scalable CPU that can be integrated into its GPU roadmap, as is the case with AMD and Intel.”Billionaire Masayoshi Son has been selling some of SoftBank’s trophy assets as the company seeks to pay down debt at the Japanese conglomerate. SoftBank has offloaded part of its stake in Chinese internet giant Alibaba Group Holding Ltd. and a chunk of its holdings in wireless carrier T-Mobile US Inc.SoftBank has been exploring options to exit part or all of its stake in Arm through a sale or public stock listing, Bloomberg News has reported. The chip-design company could go public as soon as next year if SoftBank decides to proceed with that option, people with knowledge of the matter have said.Arm has become more valuable as it pushes its architecture into smart cars, data centers and networking gear. The company could be worth $44 billion if it pursues an initial public offering next year, a valuation that may rise to $68 billion by 2025, according to New Street Research LLP.Nvidia, based in Santa Clara, California, is the world’s largest graphics chipmaker. The stock has surged more than twenty-fold in the past five years, giving the company more firepower to do large deals. Nvidia’s market value has increased to more than $260 billion in that time, surpassing Intel. The stock was little changed Friday in New York.(Updates with analyst comment in eighth paragraph)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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  • 3 ASX LICs offering big dividend yields over 7%

    Woman holding up wads of cash

    Listed investment companies (LICs) are a great option to invest in for big dividend yields in my opinion.

    What’s a LIC?

    A LIC is a company just like any other. LICs provide half-year and annual reports, they have boards of directors and so on.

    Normal operating companies might be a retailer, a bank, a tech company or something like that. The main difference is that LICs invest in other businesses on behalf of shareholders.

    LICs make profit from investment returns. That’s a combination of capital growth and the dividends the LICs receives from its investments.

    The boards of LICs can choose to pay a smoothed dividend for investors with its total returns.

    Here are three ideas with big dividend yields of more than 7%:

    WAM Leaders Ltd (ASX: WLE)

    WAM Leaders is a LIC run by Wilson Asset Management (WAM). The LIC targets large cap ASX shares. But you shouldn’t think of it as a passive investment vehicle like an exchange-traded fund (ETF). It’s quite active, switching between positions to try to make the best profit it can.

    Over the past year its portfolio returned 2.7% before fees, expenses and taxes, outperforming the S&P/ASX 200 Accumulation Index by 10.4%. That’s impressive in my opinion.

    In FY20 the LIC increased its dividend by 15% to 6.5 cents per share. That equates to a grossed-up dividend yield of 8.1% at the current WAM Leaders share price. It has increased its dividend each year since FY17 when it started paying one – it was only formed in 2016.

    At the end of June 2020 it had a portfolio well suited to ride through any COVID-19 problems. Some of its biggest holdings were: BHP Group Ltd (ASX: BHP), CSL Limited (ASX: CSL), Goodman Group (ASX: GMG), Newcrest Mining Limited (ASX: NCM), OZ Minerals Limited (ASX: OZL), Rio Tinto Limited (ASX: RIO), Telstra Corporation Ltd (ASX: TLS) and Woolworths Group Ltd (ASX: WOW).   

    NAOS Small Cap Opportunities Company Ltd (ASX: NSC)

    This LIC is run by Naos Asset Management, a manager which focuses on smaller ASX shares. 

    Naos generally has a portfolio around 10 names which it aims to be invested in for at least five years. That’s a high-conviction portfolio.

    Over FY20 NAOS Small Cap Opportunities Company outperformed the S&P/ASX Small Ordinaries Accumulation Index by 8.26% before fees, taxes and interest.

    The LIC seems committed to paying a quarterly dividend of 1 cent per share. That equates to an annual grossed-up dividend yield of 11.3% at the current NAOS Small Cap Opportunities Company share price.

    Using the pre-tax net tangible assets (NTA) per share of $0.68 at 30 June 2020, it’s trading at 26% discount to last month’s NTA. We’ll have to wait a week or two to see July’s NTA.

    At the moment some of its positions are: Eureka Group Holdings Ltd (ASX: EGH), MNF Group Ltd (ASX: MNF) and Over The Wire Holdings Ltd (ASX: OTW).

    Future Generation Investment Company Ltd (ASX: FGX)

    Future Generation is a LIC with a twist. It doesn’t invest in individual ASX shares. It invests in funds of fund managers that invest in ASX shares. But neither Future Generation or the fund managers charge any management fees. That enables Future Generation to donate 1% of its net assets per year to youth charities.

    At the current Future Generation share price it offers a grossed-up dividend yield of 7.1%. It has increased its dividend each year since 2015.

    It’s invested in around 20 fund managers at the moment. I think that provides a lot of attractive diversification. Bennelong is the fund manager with the biggest allocation right now.

    Future Generation is trading at a 13% discount to the NTA at the end of June 2020.

    Foolish takeaway

    I like all three of these LICs for dividend income potential. The Naos LIC clearly has the biggest yield and it’s trading at a big discount to its NTA. But Future Generation offers very attractive diversification, a good discount and a good yield too. It’s hard to pick between these two.

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    Tristan Harrison owns shares of FUTURE GEN FPO and NAO SMLCAP FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. and Over The Wire Holdings Ltd. The Motley Fool Australia owns shares of and has recommended MNF Group Limited and Telstra Limited. The Motley Fool Australia has recommended Over The Wire Holdings Ltd. 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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  • 1 ASX share to take advantage of the strong FAANG shares

    dice on top of piles of coins spelling the word nasdaq

    There’s one ASX share in-particular that I think is a good option to get exposure to the US FAANG tech shares. I’m talking about BetaShares NASDAQ 100 ETF (ASX: NDQ).

    For people that don’t know, the FAANG shares are a group of technology stocks in America. It stands for Facebook, Apple, Amazon, Netflix and Google. Google is now called Alphabet, so perhaps it should be called FAANA. Or FAAAN.  

    Over the past decade there are few shares that have performed as well as this tech group have.

    When you look at the recent profit updates you can see that the FAANG shares can perform strongly (perhaps even stronger) during a global pandemic.

    More people are staying inside. They may watch more Netflix or Youtube. They may go on one of Facebook’s platforms more often. Perhaps they’re more likely to order things on Amazon. Maybe they’ll decide to buy a new Apple device.

    The FAANG shares mostly deliver their services digitally, so they were well suited to keep thriving during the COVID-19 restrictions.

    Facebook, Apple and Amazon all reported impressive numbers:

    Amazon said its sales jumped 40% for the three months to US$88.9 billion with profit doubling to US$5.2 billion.

    Apple reported its quarterly revenue increased 11% year on year to US$59.7 billion with remote work and school contributing to higher sales and iPads and Mac computers. Apple’s profit increased 12.5% to US$11.25 billion.

    Facebook announced that its revenue increased by 11% to US$18.7 billion and net profit rose by 98% to US$5.18 billion.

    Alphabet revealed that its revenue fell 2% to US$38.3 billion and net profit dropped around 30% over the corresponding period as many companies reduced their advertising spending.

    Alphabet’s revenue was better than expected, so I suppose that counts as a win as well.

    Technology juggernauts

    The FAANG group have incredibly strong economic moats. You don’t see the same sort of strength with ASX shares. 

    Imagine how much you’d need to spend to create a better phone company (and app store) than Apple. Think how much you’d have to spend on software development and advertising to be people’s preferred internet search engine over Google. Would it even be possible to dislodge any them? The FAANG shares are powerful. 

    There’s more growth to come. More advertising will probably shift to digital, particularly when it comes to advertising on online video – good for Facebook and Alphabet’s Youtube. Virtual reality will be good for Facebook’s Oculus. A shift to automated cars should be very good for Waymo. Quite a few of the NASDAQ giants are helping the world shift to cloud computing.

    NASDAQ ETF

    There’s more to BetaShares NASDAQ 100 ETF than just the FAANG shares. The ETF owns 100 shares. There are other very important holdings like Microsoft, Nvidia, PayPal, Cisco, Intel, Broadcom and so on. But Apple, Amazon, Microsoft, Alphabet and Facebook make up almost half of the ETF’s holdings.

    The ETF offers good diversification for a pretty cheap fee. Its annual management fee is 0.48%. There are ETFs that cost less, but you get targeted exposure to some of the best technology businesses in the world. It’s the net returns that count the most. 

    It has performed very well after fees. Over the past year the ETF has returned 35.5%. Over the past three years it has returned 26.6% per annum and over the past five years it has returned 21.5% per annum. You can’t argue with those types of returns. That’s much better than the ASX in my opinion.

    The FAANG shares are powering ahead. But there are a couple of potential problems ahead. One is that they are coming under increased scrutiny by politicians in the US who claim they are being anticompetitive and bias. In other places around the world, the companies face slightly lower profit margins – Australia wants the FAANG shares to pay for news and Europe is challenging them on competition and tax.

    But I don’t think those issues will stop the FAANG shares. The US wouldn’t want to break them up into pieces – otherwise the Chinese giants may gain an advantage.   

    I think BetaShares NASDAQ 100 ETF is a great investment idea for the long-term, though I think the US election could cause some volatility. Sometime in the next six months could prove to be a good buying opportunity. But you should be able to do well from today’s price. 

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    *Returns as of June 30th

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    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 BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended BETANASDAQ ETF UNITS. 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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  • Smart investors should buy these ASX growth shares

    thinking

    I believe Australian investors are spoilt for choice when it comes to growth shares.

    But with so many high quality and fast-growing shares to choose from, it can be hard to decide which ones to buy.

    To give investors a hand, I thought I would pick out three fast-growing companies which I believe could be great investments in August. Here’s why I would buy these shares:

    Altium Limited (ASX: ALU)

    The first growth share I would suggest investors consider buying is Altium. It is an electronic design software platform provider. The rapidly growing Internet of Things (IoT) and artificial intelligence (AI) markets are causing a proliferation of electronic devices globally. Altium is perfectly positioned to benefit from this due to its leadership position in the electronic design market. Overall, I believe this will allow Altium to deliver on its revenue target of US$500 million in FY 2025. This compares to its FY 2020 revenue of ~US$189 million.

    Nanosonics Ltd (ASX: NAN)

    Another growth share to consider buying is Nanosonics. I think the infection prevention company is a fantastic long term investment. This is due to the strength and growth potential of its trophon EPR disinfection system for ultrasound probes and upcoming product launches. While not a lot is known about these secretive new products, they are understood to have similar market opportunities to the trophon EPR system. And if they are anywhere near as successful, the sky could be the limit for the Nanosonics share price.

    Pro Medicus Limited (ASX: PME)

    A final growth share that I would buy is Pro Medicus. It is a leading provider of radiology IT software and services to hospitals, imaging centres, and healthcare companies. Demand for its offering from major healthcare institutions has been growing strongly over the last few years. This has led to stellar earnings growth. For example, in FY 2019 Pro Medicus delivered a massive 91.9% increase in full year profit to $19.1 million. It then backed this up with a 32.7% increase in net profit after tax to $12.1 million during the first half of FY 2020. I suspect the pandemic may stifle its second half growth, but I expect it to rebound strongly once the crisis passes.

    5 stocks under $5

    We hear it over and over from investors, “I wish I had bought Altium or Afterpay when they were first recommended by The Motley Fool. I’d be sitting on a gold mine!” And it’s true.

    And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!

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    *Extreme Opportunities returns as of June 5th 2020

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    James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Nanosonics Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Pro Medicus Ltd. The Motley Fool Australia has recommended Nanosonics 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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  • A TikTok-Microsoft Deal Might Solve Everything

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  • How to turn $20,000 into over $200,000 in 10 year with ASX shares

    Money

    I’m a very big fan of buy and hold investing and believe it is the best way for investors to grow their wealth.

    To demonstrate how successful it can be, I like to pick out a number of popular ASX shares to see how much a single $20,000 investment 10 years ago would be worth today.

    This time around I have picked out the three ASX shares that are listed below:

    ASX Ltd (ASX: ASX)

    The operator of the Australian stock exchange has been a great place to invest your money over the last decade. Thanks to its near monopoly on share trading in Australia, ASX Ltd has been able to grow its earnings and dividends at a consistently solid rate over the period. This has ultimately led to the ASX Ltd share price generating an average total return of 13.8% per annum since 2010. This would have turned a $20,000 investment in its shares into almost $73,000.

    Nanosonics Ltd (ASX: NAN)

    If you invested $20,000 into the shares of this infection prevention company in 2010, you would be sitting on a small fortune today. Thanks to the success of Nanosonics’ trophon EPR disinfection system for ultrasound probes, the company’s sales have been growing at a rapid rate over the last decade. This has led to Nanosonics shares generating an average total return of 27.2% per annum. This means that investment would now be worth an incredible $220,000.

    Sonic Healthcare Limited (ASX: SHL)

    A winning combination of organic and acquisitive growth led to this international medical diagnostics company growing its earnings and dividends at a solid rate over the last 10 years. This has resulted in the Sonic Healthcare share price smashing the market over the period. Its shares have generated an average total return of 14.3% per annum since 2010. This would have turned $20,000 into over $76,000 today.

    Legendary stock picker names 5 cheap stocks to buy right now

    Motley Fool resident tech stock expert Dr. Anirban Mahanti has stumbled upon five stocks he believes could be some of the greatest discoveries of his investing career.

    These little-known ASX stocks are growing like gangbusters, yet you can buy them today for less than $5 a share. Click here to learn more.

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    James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Nanosonics Limited. The Motley Fool Australia has recommended Nanosonics Limited and Sonic Healthcare 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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  • These were the best performing shares on the ASX 200 last week

    shares record high

    After a solid start to the week, the S&P/ASX 200 Index (ASX: XJO) gave back all its gains and more on Friday. This led to the index recording a disappointing 1.6% weekly decline to finish at 5,927.8 points.

    Four shares that didn’t let that stop them from recording strong gains are listed below. Here’s why they were the best performers on the ASX 200 last week:

    The AP Eagers Ltd (ASX: APE) share price was the best performer on the ASX 200 last week with a 12.2% gain. Investors were buying the auto retailer’s shares after it released a trading update. Although it confirmed that trading conditions are difficult, it remains confident it will report an underlying profit from continuing operations of $40.3 million during the first half. This represents a 23.6% decline from the prior corresponding period. In addition to this, AP Eagers revealed that it had achieved permanent cost reductions of $78 million per year in the previous three months.

    The Credit Corp Group Limited (ASX: CCP) share price wasn’t far behind with an 11.3% gain. The catalyst for this was the release of its full year results. The debt collector delivered a net profit after tax of $15.5 million. This was a sharp year on year decline and driven by impairments and additional provisioning due to the pandemic. However, excluding one-off adjustments, net profit after tax would have been up 13% to $79.6 million.

    The GWA Group Ltd (ASX: GWA) share price was on form last week and recorded a 10.9% gain. This appears to have been driven by a broker note out of Credit Suisse. It upgraded the home products company’s shares to an outperform rating with a $3.05 price target. The broker made the move after online searches appeared to indicate that spending on bathroom renovations was on the rise. Combined with its cheap valuation, the broker thinks GWA is a buy.

    The Super Retail Group Ltd (ASX: SUL) share price stormed 10.7% higher last week thanks to the release of a stronger than expected full year update. That update revealed that its sales bounced back very strongly in May and June. So much so, Super Retail actually delivered solid full year sales growth of 4.2% in FY 2020. Management also advised that it expects to deliver growth in its pro forma EBITDA. This is expected in the range of $327 million and $328 million, up from $315 million in FY 2019. Though, this excludes one-offs such as its employee underpayment remediation costs.

    Legendary stock picker names 5 cheap stocks to buy right now

    Motley Fool resident tech stock expert Dr. Anirban Mahanti has stumbled upon five stocks he believes could be some of the greatest discoveries of his investing career.

    These little-known ASX stocks are growing like gangbusters, yet you can buy them today for less than $5 a share. Click here to learn more.

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    Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Super Retail Group 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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  • 3 of the best ASX dividend shares to buy right now

    ASX dividend shares

    If you’re looking to add some dividend shares to your portfolio next week, then I think the three listed below could be top options.

    Here’s why I think these dividend shares are in the buy zone:

    Fortescue Metals Group Limited (ASX: FMG)

    The first ASX dividend share to consider buying is Fortescue. I think it could be a good option due to the strong free cash flow it is generating thanks to favourable iron ore prices and its low costs. In respect to the latter, in FY 2021 Fortescue’s guidance is for cash costs of US$13.00 to US$13.50 per wet metric tonne. This is materially lower than the price it is commanding for its iron ore at present. Another positive is that the company has a strong balance sheet, which should mean it is well-positioned to return the majority of its free cash flow to shareholders. Based on the current Fortescue share price, I estimate that its shares offer a fully franked FY 2021 dividend yield of at least 5%.

    Rural Funds Group (ASX: RFF)

    Another top ASX dividend share to buy is Rural Funds. The agriculture-focused property group appears well-positioned to grow its distribution at a consistent and solid rate over the long term. This is thanks to its high quality assets and their long tenancy agreements which have periodic increases built into them. In FY 2021 Rural Funds expects to pay a 11.28 cents per share distribution. Based on the latest Rural Funds share price, this equates to a 5.5% yield.

    Telstra Corporation Ltd (ASX: TLS)

    A final ASX dividend share I would consider buying is Telstra. I like the telco giant due to its strong business model, defensive qualities, and generous dividend yield. Another positive is the progress it is making with its T22 strategy. This includes material cost cutting and the simplification of its business. Combined with the easing NBN headwind, I believe Telstra’s future is looking increasingly positive. Based on the current Telstra share price, I estimate that Telstra’s shares offer a fully franked 4.8% dividend yield.

    Where to invest $1,000 right now

    When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

    Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

    See The 5 Stocks

    *Returns as of June 30th

    More reading

    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 Telstra 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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