It’s almost April 2021 and there are some really good ASX dividend shares that would be solid picks for income for the long term.
Finding good levels of income is tough in the current world we find ourselves in. Interest rates are so low.
I think the answer could be good quality ASX dividend shares. I normally name ideas like Brickworks Limited (ASX: BKW), MFF Capital Investments Ltd (ASX: MFF) and Magellan Financial Group Ltd (ASX: MFG) as ASX dividend share ideas because that’s where I see good dividends and long term growth. But I have another two suggestions today:
Future Generation Investment Company Ltd (ASX: FGX)
Future Generation is one of the most compelling ASX-focused listed investment companies (LIC), in my opinion.
A normal LIC represents a single portfolio of shares run by a funds management outfit. This LIC is made up of almost 20 portfolios, each run by a separate funds management firm. The underlying diversification seems very good.
Each of those fund mangers work pro bono – meaning for free – so that Future Generation can instead donate 1% of its net (tangible) assets each year to charities focused on young Australians. I think this is a great cause.
There are three fund managers that make up more than 10% of the portfolio, they are: Bennelong, Paradice and Regal.
The gross investment portfolio return of the Future Generation portfolio has been solid – since inception in September 2014, the portfolio has returned an average of 9.9% per annum, compared to 7.5% from the All Ordinarines Index.
Future Generation has been using that performance to pay a growing dividend. In FY20 Future Generation increased its dividend by 4% to 5.2 cents per share.
With the Future Generation share price currently valued at a 5% discount to the February 2021 NTA of $1.36, it has a fully franked dividend yield of 4%.
APA Group (ASX: APA)
APA is an interesting ASX dividend share – it’s a massive energy infrastructure business with a gigantic pipeline network around Australia.
Gas seems like it will continue to be an important part of the energy picture and APA is generating good cashflow each year, which allows it to pay a solid and growing distribution to investors. In-fact, that distribution has grown every year going back to before the GFC.
APA continues to announce new projects which will add to its gas pipeline and grow cashflow a bit more.
There are three key reasons why I think APA could be a solid long term buy. The first is that it’s looking to invest into the USA, which is a huge potential market for opportunities. The next is that APA is pursuing other green energy assets to add onto its existing portfolio, which will diversify its assets. The final reason is that its pipelines could be used for transporting hydrogen in the years to come.
