There are some great dividend shares on the ASX in my opinion.
Dividends can play an important part in an investor’s return and it can be useful for increasing your overall level of income.
MFF Capital Investments Ltd (ASX: MFF)
MFF Capital could be one of the best listed investment companies (LICs) available for ASX investors.
It looks to invest in global shares that are quality and good value at the time of the purchase.
Chris Mackay is the lead portfolio manager of the LIC. He also owns a lot of MFF Capital shares, not too far off $200 million of them. That’s a lot, so he’s really aligned with current shareholders and wants a good outcome.
Not only are the share picks and returns good, but it also has a low fixed cost, which gets smaller as the LIC gets bigger.
At the moment some of its largest holdings include: Visa, Mastercard, Amazon, Home Depot and Facebook.
Right now, the MFF Capital share price is trading at a pre-tax net tangible assets (NTA) discount of almost/around 10%. That’s attractive for such a good LIC in my opinion.
MFF Capital is targeting a biannual dividend of 5 cents per share, which equates to a dividend yield of 5.6% right now including the franking credits.
Brickworks Limited (ASX: BKW)
If you’re looking for a safe pair of hands when it comes to dividends, then Brickworks could be one of the best ideas because it has maintained or grown its dividend every year for over four decades.
How has it done this? The biggest reason is the large shareholding of Washington H. Soul Pattinson and Co Ltd (ASX: SOL) shares. The investment house and Brickworks have had a cross-ownership structure for decades which has stopped unwanted investor attention who may try to come in and break it up.
The diversified nature of WHSP’s portfolio means that it can provide defensive and perhaps generally uncorrelated returns compared to the broader ASX.
Brickworks also sells a wide variety of building products in Australia such as bricks, precast, roofing, masonry and cement. This division is steadily investing and building up a strong market position, particularly as it invests in its operations for stronger efficiencies.
The growth in the US is also very promising in the long-term considering how large of a market that North America is.
Another very useful, and growing, division is the joint venture property trust which is steadily building a portfolio of industrial properties. At the moment it’s working on building two huge, advanced distribution warehouses for Amazon and Coles Group Ltd (ASX: COL). These new warehouses will significantly increase the distributable rental profit to Brickworks once complete.
At the current Brickworks share price, it has a dividend yield of 4.5% including the franking credits.
