Dividends can be one of the most important considerations for Australian investors, especially those who are looking to live off the income their shares provide.
Well-established blue-chip companies like the banks are less likely to see substantial share price growth over many years, so dividends are often seen as the key reason to invest in them.
Given the importance of dividends and the difficulty investors have had over the last few years finding a sustainable payout due to the aftermath of global disruptions, we thought we would put together a list of non-banking best dividend stocks to keep an eye on in 2024.
To help generate a list, we reached out to Bell Direct's head of distribution Tim Sparks who sent us 20 thought starters you might keep your eye on in 2024.
Unfortunately there's no one magic stock that is 'best' for everyone. Instead, you should look into your own portfolio, your individual needs and your investment strategy to decide what stock is right for you. Further still, nobody can say for certain which direction a share will go as past performance is no guarantee of future results. So keep in mind these are stock ideas only and should not be taken as personal financial advice.
Please note the below are not share trading recommendations. They are simply investing ideas. Before trading you should do your own research to determine if any of the below are right for you.
All below data is as of 01 October 2024.
WAM Capital Ltd is an investment company that offers exposure to a portfolio of growth companies on the ASX. It currently has a market capitalisation of $1.8 billion.
The company has maintained a consistent dividend payout in 2024, with a half-year dividend of 7.75c per share. Unlike previous years, dividends were only 60% franked instead of fully-franked.
Yancoal Australia Ltd is a coal-mining company that manages and operates mines in NSW, Queensland and Western Australia. It currently has a market capitalisation of $8.08 billion.
It has so far paid out one dividend in 2024 at 32.5c per share (fully-franked).
McMillan Shakespeare Ltd operates within the financial sector, offering salary packaging, vehicle leasing and other financial products and services. It has a market capitalisation of $1.05 billion and more than 1,300 employees as of 2024.
McMillan has paid out 3 dividends so far in 2024 of between 76c and 78c, all fully-franked.
Fortescue Ltd is a metal mining company and the world's fourth largest iron ore producer. It is currently based out of Perth, Western Australia and is one of the largest companies on the ASX, with a market capitalisation of $61.5 billion.
Fortescue has been a consistent performer for shareholders and also regularly distributes fully-franked dividends. It has a dividend yield of 9.53% (October 2024) and has paid out 2 dividends so far in 2024 at $1.08 and 89c per share.
A telecom and digital services company, Spark New Zealand is one of the largest companies on the New Zealand Exchange (NZX) and is also listed on the ASX.
It currently has a P/E ratio of 17.62, and offers a 8.97% dividend to investors. It has paid out 2 unfranked dividends in 2024 at 12.83c per share.
IGO Ltd is a mineral exploration company with a focus on enabling clean energy. It has a market capitalisation of $4.35 billion.
The company offers investors a dividend yield of 8.87% and a P/E ratio of 87.4, with 2 fully-franked dividend payments in 2024 at 11c and 26c per share.
Metrics Master Income Trust Unit offers exposure to Australian corporate loans with the aim of providing investors with stable income through interest payments.
It has paid out 2 unfranked dividends in 2024, each at 1.35c per share.
New Hope Corporation is an Australian diversified energy company with significant interests in coal mining, exploration, and development. It has a market cap of $4.45 billion.
With a dividend yield of 8.45%, it offers investors a competitive return, indicative of its steady financial performance. The earnings per share stand at $0.24, reflecting the company's ability to generate consistent profits and maintain a healthy dividend payout for its shareholders.
It has paid out 2 fully-franked dividends in 2024, at 17c and 22c per share.
Atlas Alteria is a global transport operator which specialises in toll roads. It currently has projects in France, Germany and the US and a market capitalisation of $7 billion. One of the company's notable projects is the Chicago Skyway, a 12.5km elevated toll road in which the company owns a 66.67% interest.
Overall, Atlas Arteria offers investors an opportunity to invest in a stable and diversified toll road portfolio, with a history of strong financial performance and a commitment to delivering returns through dividends.
It has given investors 2 unfranked dividends in 2024, at 20c per share.
Liberty Financial Group Pty Ltd offers a range of lending and financial services in Australia and New Zealand. It has a P/E ratio is 8.81, indicating a reasonable market valuation compared to its earnings.
The company offers a dividend yield of 7.76%, demonstrating its ability to generate investor returns, but has only paid out one unfranked dividend in 2024, at 13c per share.
Woodside Energy Group is Australia's largest independent oil and gas company, with a market cap of $49.2 billion.
The company's dividend yield is significant at 7.69% as of October 2024, with 2 fully-franked dividend payments in 2024 and a net profit margin of 14.76%.
SkyCity is a gambling and entertainment company based in Auckland, New Zealand and has a market cap of $995 million. Founded in 1996, it owns and operates 5 casinos and 3 luxury hotels in Australia and New Zealand, as well as Auckland's Sky Tower.
It has paid out one unfranked dividend so far this year, at 4.9c per share for a dividend yield of 7.44%.
Helia Group Limited is an Australian financial services company that provides Lenders Mortgage Insurance (LMI). It has been operating since 1965. The company is headquartered in Sydney, Australia, and currently has a market capitalisation of $1.15 billion.
It has paid out two dividends in 2024, a 33.3% franked 45c dividend in March and a fully-franked 15c dividend in September.
Growthpoint Properties Australia is a real estate investment trust listed on the ASX with a market capitalisation of $2.02 billion.
It has maintained a dividend yield of approximately 7.23%, with a 9.65c dividend per share paid out in 2024, with a franking percentage of 0.63%.
APA Group is an energy infrastructure company that owns and operates gas, electricity, solar and wind assets. It has a market capitalisation of $10.06 billion.
It has paid out one 23.91%-franked dividend in 2024, at 29.5c per share, for a dividend yield of 7.22%.
Deterra Royalties is a Perth-based mining royalties company and the first company to apply a mining royalty business model in Australia. It acquires and manages a portfolio of mining assets, focusing on bulks, base and battery metals.
It currently has a net profit margin of 64.40% and a P/E ratio of 13.93. It has paid out two fully-franked dividends in 2024, at 14.89c and 14.4c per share.
Insignia Financial Ltd is a financial services company based in Melbourne with a market capitalisation of $1.74 billion.
The company has paid out an unfranked dividend of 9.3c per share in 2024, resulting in an 7.07% yield. Insignia's dividend history has declined since 2018 and it hasn't offered a fully-franked dividend since 2022.
Nine Entertainment is an Australian media entertainment company and one of the country's major free-to-air broadcasters. It has a market capitalisation of $2 billion.
It has paid out two fully-franked dividends in 2024, at 4c and 4.5c per share for a dividend yield of 6.92%.
Charter Hall operates in the Equity Real Estate Investment Trusts (REITs) industry, managing a $4,237 million portfolio of convenience retail shopping centres. It currently has a market capitalisation of $2.06 billion.
Its geographically diverse portfolio of properties includes growth markets across Australia. Charter Hall Retail REIT is managed by one of Australia's leading property groups, Charter Hall Group, which is also listed on the ASX, and has funds under management of over $82.6 billion.
It has paid out one unfranked dividend this year at a price of 12.4c per share, for a yield of 6.87%.
We filtered Australian stocks that had been public for at least 5 years with market caps of over $1 billion and then selected the 20 stocks with the highest yield.
Debt-to-equity (D/E) ratio: Compares a company's level of debt to its amount of shareholder equity. Generally speaking, the higher the ratio, the more leveraged a company is, although this ratio will differ broadly across sectors.
Price-earnings (P/E) ratio: The relative value of a company's stock price to its recent profit results, i.e. the price investors are paying for every dollar of profit the company makes. A high P/E ratio might indicate investors expect growth to occur in the future and are willing to pay more for it, or it can also indicate the stock is overpriced.
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Dividend investors will typically look for the following attributes when selecting their ASX dividen stocks:
Bell Direct's head of distribution Tim Sparks also gave the following tips:
"When searching for dividend stocks, investors should be looking for companies with consistent, reliable cash flows from a product or service with a clear competitive advantage. Ultimately it is profit from these cash flows that will lead to dividends," Sparks says.
He also cautioned investors of the risks of dividend traps, highlighting the need to analyse 2 key metrics before purchasing dividend shares.
"The first is to look at the company's historical dividends to make sure they are consistent. The second – look at the company's dividend payout ratio and ensure it didn't suddenly increase based on a one-off event," Sparks explains.
"The average dividend yield for an ASX 200 company is about 4%. If a stock is yielding say 15% then it is unlikely this can be maintained and that stock needs further analysis to avoid disappointment."
To buy dividend stocks, you'll need to sign up to an online broker. You can use the table below to compare online brokers (also known as share trading platforms) available in Australia.
Important: The standard brokerage fee displayed is the trade cost for new customers to purchase $1,000 of either Australian or US shares. Where a platform charges different fees for both US and Australian shares we show the lower of the two. Where both CHESS sponsored and custodian shares are offered, we display the cheapest option.
Image source: Getty
Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, options or any specific provider, service or offering. It should not be relied upon as advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involve substantial risk of loss and therefore are not appropriate for all investors. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades.
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