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The Qantas Airways Limited (ASX: QAN) share price is pushing higher on Friday morning.

At the time of writing, the airline operator’s shares are up 1.5% to $4.59.

Why is the Qantas share price taking off?

Investors have been bidding the Qantas share price higher today following the release of a market update.

According to the release, continued strong travel demand across both domestic and international has driven a further reduction in the company’s net debt.

Management expects Qantas’ net debt to be well below pre-COVID levels at $4 billion at the end of June. This is an improvement of approximately $1.5 billion since the end of December.

And while Qantas still expects to report a significant full year underlying loss in FY 2022, it remains on track to deliver second-half underlying earnings before interest, tax, depreciation and amortisation (EBITDA) of between $450 million to $550 million.

Importantly, management highlights that the company is also on track to return to underlying profit in FY 2023.

This is despite the airline adjusting its domestic capacity levels for much of FY 2023 to assist with the recovery of sustained high fuel prices.

Capacity reductions

For July and August, an additional 5 percentage points of capacity will be removed on top of the 10% announced in May.

This total 15% cut will also be applied to September and a cut of 10 percentage points will be applied to schedules from October through to the end of March 2023.

This brings the company’s planned domestic flying down to 106% of pre-COVID levels for the second quarter of FY 2023 and 110% for the third quarter.

Management notes that these reductions, combined with robust international and domestic travel demand, are expected to help Qantas substantially recover the elevated cost of fuel indicated by forward oil prices. In addition, they will assist with the near-term resourcing pressures currently being felt across aviation and the broader economy.

There are no changes to the company’s international capacity plans. Flying will steadily increase from around 50% of pre-COVID levels currently to around 70% by the end of the first quarter of FY 2023 to help meet demand.

Anything else?

In other news, Jetstar’s CEO Gareth Evans has made the decision to step down from his current role in December. An internal recruitment process for the role is now underway.

Finally, Qantas revealed that up to 19,000 EBA-covered employees across the company will be offered a $5,000 boost as the national carrier shares the benefits of its recovery. This follows a two-year wage freeze.

The post Qantas share price takes off following market update appeared first on The Motley Fool Australia.

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More reading

• What’s dragging on the Qantas share price today?
• ASX 200 travel shares take off again on Tuesday. Here’s why
• What’s boosting the Qantas share price on Tuesday?
• Why are ASX 200 travel shares lifting off on Monday?
• Qantas share price lifts amid new sustainability partnership

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.

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The BHP Group Ltd (ASX: BHP) share price has taken a tumble this month amid weakness in commodity prices.

This has particularly been the case with the iron ore price, which has pulled back meaningfully following softer downstream demand in China and recession fears.

In light of this recent share price weakness, investors may be wondering what this means for dividends in the coming years. So, let’s take a look at what analysts are saying about the Big Australian’s dividend.

Where is the BHP dividend heading?

According to a note out of Goldman Sachs this week, its analysts are expecting BHP to reward shareholders with some big dividends in the coming years.

As a starting point, in FY 2021, BHP rewarded shareholders by more than doubling its fully franked dividend to US$3.01 per share.

Goldman Sachs expects this to be increased again in FY 2022. It is forecasting a US$3.50 per share fully franked dividend. Based on the current BHP share price of $39.77 and current exchange rates, this suggests a dividend yield of 12.7%.

And while the broker is expecting easing coal and iron ore price to weigh on its profits and dividends in FY 2023, it still believes BHP will pay another big dividend.

It is forecasting a US$2.65 per share dividend for FY 2023, which represents a yield of 9.6%.

Finally, in FY 2024, Goldman Sachs is expecting coal and iron prices to ease further. As a result, it is forecasting a fully franked US$2.01 per share dividend to be paid to shareholders. This would still mean a very attractive yield of 7.3%.

Decent upside predicted for the BHP share price

Goldman isn’t just expecting the BHP dividend to provide attractive returns. It also sees plenty of value in the BHP share price.

The broker has a buy rating and $49.40 price target on the mining giant’s shares.

The post Here’s the BHP dividend forecast through to 2024 appeared first on The Motley Fool Australia.

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More reading

• Here’s why the BHP share price is in the red today
• ASX 200 midday update: Pilbara Minerals’ lithium price update, BHP tumbles
• Why we just bought these 3 ASX shares: fund
• 5 things to watch on the ASX 200 on Thursday
• Could China ‘steel’ the show for the iron ore price?

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.

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The National Australia Bank Ltd (ASX: NAB) share price has struggled alongside its ‘big four’ peers this month.

It’s tumbled 13% since its final close of May. For context, the S&P/ASX 200 Index (ASX: XJO) has also slipped around 9% so far this month.

At the time of writing, the NAB share price is $27.13. And that leaves the banking giant trading with a notable dividend yield of more than 5%.

Let’s take a closer look at the payout ratio currently offered by NAB shares.

NAB shares offer a 5.1% dividend yield

Those invested in NAB shares have been offered $1.40 of dividends over the past 12 months.

That came in the form of a 67-cent final dividend for financial year 2021 and a 73-cent interim dividend.

Taking into account its current share price, that leaves the bank trading with a 5.1% dividend yield.

Potentially making the bank’s payouts even more exciting are the tax imputations they bring.

NAB has been handing out fully franked dividends for 15 years now. That means its dividends could bring additional benefits to some shareholders come tax time.

On top of that, NAB offers a dividend reinvestment plan (DRP), allowing investors to opt to receive additional shares in the bank rather than cash dividends.

However, the dividend yield offered by NAB is dwarfed by that of some of its big four banking peers.

In terms of dividend yields, shares in Australia and New Zealand Banking Group Ltd (ASX: ANZ) lead the pack. They boast a 6.5% yield right now.

That’s better than Westpac Banking Corp (ASX: WBC) shares’ current 6.1% dividend yield.

Meanwhile, Commonwealth Bank of Australia (ASX: CBA) shares offer a 4.1% dividend yield.

While this year has been tough on the NAB share price – it has slipped nearly 8% year to date – the stock is still in the longer-term green. It has gained 4% since this time last year.

The post Are NAB shares really offering a dividend yield above 5%? appeared first on The Motley Fool Australia.

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More reading

• Should you ‘buy the dip’ in ASX 200 bank shares?
• What’s the outlook for ASX 200 bank dividends?
• Is the NAB share price about to hit the comeback trail?
• ‘Price makers’: 3 ASX 200 shares that can pass on rising costs in an inflationary environment
• Worried about a US recession? Here’s what the ASX 200 banks are forecasting

Motley Fool contributor Brooke Cooper 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 recommended Westpac Banking Corporation. 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 REA Group Limited (ASX: REA) share price has fallen in 2022, just like many other ASX shares.

REA Group shares are currently down around 40% from the start of the year.

With the business now trading significantly lower, I believe that it’s looking like a quality pick during the carnage for many ASX growth shares.

What does REA Group do?

The company describes itself as a multinational digital advertising business that specialises in property. It says it operates Australia’s leading residential and commercial websites — realestate.com.au and realcommercial.com.au.

REA Group also says it owns the leading website dedicated to share property, Flatmates.com.au, as well as the property research website property.com.au. It owns mortgage broking businesses Smartline and Mortgage Choice as well as property data services business PropTrack.

The company also has a few international investments. It holds a controlling interest in REA India, which is the operator of established brands Housing.com, Makaan.com and PropTiger.com, and owns a leading portal in China called myfun.com. It also holds a minority shareholding in Move Inc, which owns realtor.com in the US, and the PropertyGuru Group, which is the operator of leading property sites in Malaysia, Singapore, Thailand, and Vietnam.

Recent trading

Before I get to my thoughts on the business, let’s look at the most recent trading update from the company.

Last month, the ASX share told investors about its numbers for the three months to 31 March 2022. Excluding acquisitions, revenue went up 17% to $278 million while operating expenses only climbed 6% to $122 million, leading to earnings before interest, tax, depreciation and amortisation (EBITDA) rising 23% to $155 million and free cash flow going up 35% to $91 million.

However, the company noted that April national residential listings were down 8% year-on-year, with Sydney listings down 19% and Melbourne down 18%. It said national listings would likely be down year-on-year in the fourth quarter, reflecting “very strong prior period listings and potential impacts from the federal election”.

But, the company did say it expects fourth-quarter volume headwinds to be more than offset by contracted price increases and increased depth penetration.

It’s targeting full-year positive operating jaws, meaning that it’s aiming for underlying profit margin growth.

Why I think the REA Group share price is better value

I think REA Group has a strong platform for growth. Its strong market position for advertising property allows it to increase prices regularly while continuing to attract a high number of sellers and potential buyers. It receives 124 million average monthly visits and 3.4 times more visits for realestate.com.au than the nearest competitor each month on average.

The international element of the business gives it more long-term growth potential in my opinion, with its exposure to countries with large populations such as India and the USA.

It generates good free cash flow, as seen by its quarterly update, and it has also been paying a dividend that has grown every year since 2009 apart from 2020 when COVID-19 struck.

With the quality business model I’ve described above, I think the REA Group share price is much better value after a near 40% fall in 2022.

The post Here’s why I think the REA Group share price is a buy right now appeared first on The Motley Fool Australia.

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More reading

• Top brokers name 3 ASX shares to buy today
• Why Ampol, Downer, Fletcher Building, and REA shares are pushing higher
• 2 powerhouse ASX shares going for dirt cheap right now: expert
• Why has the REA share price crashed by 40% in 2022?
• 2 blue chip ASX 200 shares that Goldman Sachs rates as buys

Motley Fool contributor Tristan Harrison 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 recommended REA Group Limited. 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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Are you searching for dividend shares to buy for your portfolio? If you are, then you may want to check out the two listed below.

Here’s why these ASX dividend shares are rated as buys by experts:

Dexus Industria REIT (ASX: DXI)

The first ASX dividend share that could be in the buy zone is industrial and office property company Dexus Industria.

Analysts at Morgans are very positive on Dexus Industria. This is due to the company’s attractive yield and medium term growth opportunities. The latter are being supported by its burgeoning development pipeline.

Morgans has an add rating and $3.65 price target on the company’s shares.

As for dividends, the broker is forecasting dividends per share of 17.3 cents in FY 2022 and 17.6 cents in FY 2023. Based on the current Dexus Industria share price of $2.76, this will mean yields of 6.3% and 6.4%, respectively.

Harvey Norman Holdings Limited (ASX: HVN)

Another ASX dividend share that has been rated as a buy is retail giant Harvey Norman.

Analysts at Goldman Sachs are very positive on the retailer despite the tough operating environment and the rising threat of online competition.

In respect to the latter, the broker highlights that Harvey Norman “has a greater preference within the boomer generation and a higher exposure to regional Australia.” It believes this protects the company from online disruption.

Goldman Sachs has a buy rating and $5.80 price target on its shares.

In respect to dividends, the broker is forecasting fully franked dividends of 43.3 cents per share in FY 2022 and 39.6 cents per share in FY 2023. Based on the current Harvey Norman share price of $3.71, this will mean yields of over 10% for both years.

The post 2 quality ASX dividend shares with 6%+ yields experts rate as buys appeared first on The Motley Fool Australia.

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More reading

• Why are these ASX 200 retail shares lagging the market today?
• Why BHP, Block, Harvey Norman, and PointsBet shares are sinking
• 2 high yield ASX dividend shares to buy according to analysts
• Belt tightening? 5 ASX 200 consumer shares slipping to new 52-week lows today
• ASX retail shares tumble following RBA rate rise

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 positions in and has recommended Harvey Norman Holdings Ltd. The Motley Fool Australia has positions in and has recommended Harvey Norman Holdings Ltd. 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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We already know this year’s modus operandi for the market seems to be to punish certain ASX shares regardless of business performance.

With so many macroeconomic headwinds, investors are irrationally fleeing some companies just because of their style or sector.

Glenmore Asset Management saw some of its ASX shares hammered in May for this exact reason.

“With interest rates globally continuing to rise from very low levels, we continue to see valuations of a wide range of stocks compress, in particular growth stocks,” said portfolio manager Robert Gregory in a memo to clients.

But when the stock price starts diverging from business performance, the gap has to eventually close back sooner or later.

With this in mind, Gregory named two fallen stocks that are not widely discussed, but he’s securely keeping locked away in his portfolio:

‘Demand for new vehicles continues to exceed supply’

Car dealership network Eagers Automotive Ltd (ASX: APE) saw its share price fall 18.5% last month.

Gregory admitted the company put out a May update that forecast a pre-tax profit for the June half would be 12% to 15% below the prior comparable period.

But the trading conditions remain positive, he noted.

“Eagers said demand for new vehicles continues to exceed supply, with the new car order book having increased by more than 25% since 31 December 2021,” said Gregory.

“New car margins remain elevated, and assuming supply constraints can improve somewhat over the next 6 months, APE should be able to deliver [a] full year 2022 NPAT of ~$300m, which we would view as a strong result in a challenging environment.”

Many other fund managers agree with Gregory.

According to CMC Markets, eight out of 14 analysts rate Eagers shares as a strong buy, while three of the remaining six recommend it as a moderate buy.

The Eagers stock price has lost more than a third of its value since the start of the year, but it does pay out a 6.8% dividend yield.

Has this stock fallen so much that it can double from here?

Investment houses on the ASX have all suffered from painful drops in their valuation in 2022.

Pinnacle Investment Management Group Ltd (ASX: PNI) is no exception, losing a whopping 58% off its share price year-to-date.

In May alone it lost 13.2%.

According to Gregory, early in the month Pinnacle disclosed at an investment conference that funds under management (FUM) for the March quarter was down 2.4% from the December quarter.

But he remains optimistic as there is still net money coming in.

“Net inflows were $1.3 billion in the March 2022 quarter, which was a solid effort in volatile equity markets,” said Gregory.

“The update was broadly in line with our expectations, with the main driver of the stock price fall in our view being the declines in equity markets and general sell-off in growth stocks.”

The Motley Fool reported this month that UBS also thinks Pinnacle is undervalued.

Its analysts have slapped a share price target of $12.65, which is almost double the current level.

“The broker thinks that despite the challenges facing the investment industry, the business looks attractive over the long term,” reported The Motley Fool’s Tristan Harrison.

“The ASX [company] is looking to add new asset classes and investment strategies to its portfolio, diversifying sources of revenue and helping further growth.”

Pinnacle shares give out a handy dividend yield of 5.1%.

The post 2 cheap ASX 200 shares to buy that no one talks about: Glenmore appeared first on The Motley Fool Australia.

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More reading

• What Adore Beauty, Bubs, Eagers Automotive, and Renascor shares are storming higher
• ASX 200 midday update: BHP’s NSW coal update, Link takeover on the rocks
• This ASX 200 share is jumping 11% thanks to a $250m share buyback plan
• Belt tightening? 5 ASX 200 consumer shares slipping to new 52-week lows today
• Are these 2 compelling ASX shares buys in June 2022?

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended PINNACLE FPO. The Motley Fool Australia has positions in and has recommended PINNACLE FPO. 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 Vulcan Energy Resources Ltd (ASX: VUL) share price will be one to watch this morning.

This follows the release of a positive announcement out of the lithium developer.

Why is the Vulcan share price on watch?

The Vulcan share price could be given a boost this morning from news that the company has received an equity investment from a major automaker.

According to the release, Stellantis is investing A$76 million into Vulcan at $6.622 per share. This is a 32% premium to its last close price and will make the automaker the company’s second largest shareholder.

Stellantis is the name behind car brands including Chrysler, Citroën, Fiat, Maserati, and Peugeot.

Vulcan believes that this is the first time a top tier automaker has made an upstream investment in a listed lithium company.

The two parties have also extended their binding lithium hydroxide offtake agreement by five years to 2035.

What will the funds be used for?

The release reveals that the proceeds from this investment will go towards Vulcan’s planned production expansion drilling in its Upper Rhine Valley Brine Field (URVBF).

Vulcan is already producing geothermal energy from the URVBF and plans to produce lithium hydroxide with zero fossil fuels and net zero carbon footprint as part of the Zero Carbon Lithium Project.

Vulcan’s Managing Director, Dr Francis Wedin, was very pleased with the news. He commented:

Stellantis’ significant investment in Vulcan and the Zero Carbon Lithium Project represents a strong statement by one of the world’s largest automakers regarding sustainable and strategic sourcing of battery materials.

We are fully aligned with Stellantis’ decarbonisation and electrification goals, which represent some of the most ambitious in the industry. It is encouraging to see a leading automaker investing in local, decarbonised lithium production for electric vehicles. As our largest offtaker, we look forward to deepening our relationship with Stellantis as a substantial shareholder in Vulcan and our Zero Carbon Lithium business.

The post Vulcan share price on watch amid landmark $76 million automaker investment appeared first on The Motley Fool Australia.

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More reading

• Vulcan Energy share price tumbles despite positive lithium project update
• Here’s why the Vulcan Energy share price is sinking 12% today?
• Which ASX lithium shares are producing and which are not?
• Why is the Vulcan Energy share price tumbling 6% today?
• 3 ASX mining shares billionaire John Hancock is buying for rising inflation and the energy transition

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.

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Westpac Banking Corp (ASX: WBC) shareholders will become a little richer today as the company pays out its latest dividend.

The banking giant is rewarding eligible investors with a fully franked interim dividend of 61 cents per share.

At Thursday’s market close, the Westpac share price ended 0.46% higher at $19.62.

This came off the back of a positive day across the S&P/ASX 200 Index (ASX: XJO) which finished up 0.31%.

Below we take a look at the details surrounding the company’s interim dividend.

Westpac distributes its H1 FY22 dividend

Westpac delivered a subdued performance across its key metrics for the first half of the 2022 financial year.

In summary, revenue fell 8% to $10,230 million over the prior corresponding period. This was driven by challenging trading conditions across the company’s consumer and business segments.

And despite operating costs falling by 10% to $5,373 million, Westpac reported a 12% decrease in cash earnings to $3,095 million.

Nonetheless, the board opted to ramp up its interim dividend by 5.2% over the prior comparable period (H1 FY21).

This is in line with the capital management framework, which has a targeted dividend payout ratio of between 60% and 75%.

Based on the current share price, Westpac has a healthy dividend yield of 6.14% – the second largest among the big four banks behind Australia and New Zealand Banking Group Ltd (ASX: ANZ) at 6.56%.

Westpac share price snapshot

A disappointing past few weeks on the ASX has led the Westpac share price to tumble almost 20% in June.

This has dragged the bank’s shares to a loss of 8% this year to date. They are also down 24% over the past 12 months.

It’s worth noting that Westpac shares hit a 52-week low of $18.80 last Friday before rebounding in the days following.

Westpac has a price-to-earnings (P/E) ratio of 14.37 and a market capitalisation of roughly $68.38 billion.

The post Here are the details about the Westpac dividend being paid today appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Friday
• Should you ‘buy the dip’ in ASX 200 bank shares?
• What’s the outlook for ASX 200 bank dividends?
• What’s going on with the Westpac share price this week?
• Worried about a US recession? Here’s what the ASX 200 banks are forecasting

Motley Fool contributor Aaron Teboneras 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 recommended Westpac Banking Corporation. 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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Ask A Fund Manager

The Motley Fool chats with the best in the industry so that you can get an insight into how the professionals think. In this edition, U Ethical chief investment officer Jon Fernie reveals the one stock he reckons is reliable through economic turbulence.

The ASX share for a comfortable night’s sleep

The Motley Fool: If the market closed tomorrow for four years, which stock would you want to hold?

Jon Fernie: It’s probably a little bit conservative. We’ve gone for Coles Group Ltd (ASX: COL). 

We expect that the Australian supermarkets are pretty well-placed in the current inflationary environment, so they are going to be impacted to an extent by rising costs. 

But they’re also able to pass on the higher food inflation to consumers. And I think again, if we have a weaker economic environment, that the company’s got a resilient earnings base. They’re continuing to invest in their logistics and distribution efficiency. 

From a valuation perspective, [Coles] looks more attractive than their closest peer Woolworths Group Ltd (ASX: WOW).

MF: Yes, I was just going to ask why you’d prefer Coles over Woolworths, but it sounds like it’s a matter of it being cheaper.

JF: Yeah, basically. We think that it’s more attractively priced than Woolworths. I think Woolworths, again, is probably pretty well-placed in terms of the outlook and the resilient earnings and to deal with the higher inflation. But we think Coles is just more attractively priced.

I think you can probably sleep really well at night with a stock like Coles.

MF: Yeah, and the supermarket sector in Australia is almost a duopoly, isn’t it?

JF: Yeah, it is. They’ve got a very strong market position and I think that makes it challenging for competitors because they’ve got this advantage in terms of scale where they can invest in improving their logistics and distribution and offer more competitive prices. So it’s a real advantage.

MF: And no need to apologise for being too conservative. I think that’s what people are seeking these days, compared to a year ago when we last spoke.

The post The ASX share I hold to ‘sleep really well at night’: fund manager appeared first on The Motley Fool Australia.

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• Analysts name 2 ASX dividend shares with attractive yields to buy next week

Motley Fool contributor Tony Yoo 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 positions in and has recommended COLESGROUP DEF SET. 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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Amid all the volatility in the share market, I think ASX dividend shares are looking even more attractive.

Issues such as high inflation and rising interest rates are hurting share prices and other assets.

While it’s a tricky situation for some companies and investors, I think these lower prices make some of my preferred income ideas seem even more compelling because it’s boosting the potential dividend yields on offer.

Dividends are not guaranteed returns, but I think the below two ideas can reward investors’ patience with the delivery of solid cash payments.

Brickworks Limited (ASX: BKW)

Brickworks is one of my favourite ASX dividend shares because of the company’s impressive dividend record.

Its normal dividend has been maintained or increased every year since 1976. That means it has been 46 years since the normal dividend last decreased. In the FY22 half-year result, the company grew its interim dividend by 5% to 22 cents per share.

One of the main contributors to Brickworks’ growing dividend is its large holding of Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) shares. The investment conglomerate owns a diversified portfolio containing a number of different ASX shares, including TPG Telecom Ltd (ASX: TPG), New Hope Corporation Limited (ASX: NHC), Brickworks itself, Pengana Capital Group Ltd (ASX: PCG), and Tuas Ltd (ASX: TUA). Soul Pattinson also has private business investments.

Soul Pattinson has grown its dividend every year since 2000 for shareholders like Brickworks.

The other key area of the ASX dividend share that I like is its 50% share of an industrial property trust in partnership with Goodman Group (ASX: GMG).

This property trust is building large industrial buildings, such as warehouses, on excess land that Brickworks no longer needs. Not only is Brickworks benefiting from the completion (and valuation uplift) of these warehouses, but it’s also benefiting from growing rental income as well.

There is enough land for a building pipeline for several years in the trust.

Brickworks currently has a trailing grossed-up dividend yield of 4.9%.

Centuria Industrial REIT (ASX: CIP)

This real estate investment trust (REIT) is another business with a connection to industrial property. It describes itself as the largest pure-play industrial REIT on the ASX. It looks to provide investors with income and an opportunity for capital growth.

Properties in the portfolio are located in urban, land-constrained markets with access to densely populated catchments. It’s positioning the portfolio towards “capturing rising tenant demand while benefiting from rental growth in highly sought industrial markets”.

The ASX dividend share has also said it’s benefiting from the increasing trend of onshoring and reshoring supply chains to ensure business continuity, combined with the continued adoption of e-commerce.

It has provided guidance of funds from operations (FFO) of at least 18.2 cents per unit – that’s essentially the rental profit – and distribution guidance of 17.3 cents per unit. That means it’s valued at 16 times its estimated rental profit with an FY22 distribution yield of 5.8%.

The post Building up income: 2 ASX dividend shares I believe are a buy appeared first on The Motley Fool Australia.

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More reading

• Why ASX-listed property shares could be on the chopping block
• Analysts name 2 top ASX 200 dividend shares to buy now
• Is it time to go bargain hunting for ASX shares?
• What is the current dividend yield on Brickworks shares?
• Experts name 2 ASX dividend shares for income investors to buy now

Motley Fool contributor Tristan Harrison has positions in Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended TPG Telecom Limited. 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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