I’m on the hunt for ASX dividend shares that can provide pleasing passive income and long-term capital growth.
While the ASX has plenty of dividend-paying businesses, I don’t think the ASX’s banks and miners can provide the combination of stability and growth that I’m looking for because of the commodity volatility and challenged environments.
With that in mind, these two ASX dividend shares could be good buys in September.
WCM Global Growth Ltd (ASX: WQG)
This is a listed investment company (LIC) which invests in a global share portfolio on behalf of shareholders.
The LIC’s strategy is to look for companies that have strong economic moats, meaning competitive advantages. Moats can come in a variety of different forms including cost advantage, brand power, intellectual property and so on.
The WCM investment team also want to see these businesses have corporate cultures that enable the business to expand the moat and generate stronger profits for shareholders.
LICs pay for dividends out of the investment profits they make from their portfolios. Since the LIC’s inception in June 2017, the ASX dividend share’s portfolio has produced an average return per year of 14.9%, outperforming the global share market return of 13% per year over the same period.
The WCM Global Growth share price is trading at an 11% discount to the net tangible assets (NTA) – the underlying value – of $1.78 at 30 August 2024. Due to this discount, the dividend yield is even bigger.
The LIC has guided it’s going to pay $0.075 per share between December 2024 and September 2025, translating into a fully franked dividend yield of 4.75%, or 6.8% including the franking credits. It has grown its annual dividend each year since it commenced paying dividends in FY19.
Brickworks Limited (ASX: BKW)
Brickworks has an appealing asset base, including industrial properties and a sizeable stake in Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). Those assets are growing their cash flow payments to Brickworks, which fund impressive passive dividend income.
The ASX dividend share hasn’t cut its dividend for almost 50 years, which is an extraordinary level of consistency for shareholders, though it’s not certain to continue forever. Notably, it has grown its dividend every year for the last decade.
Pleasingly, the business typically trades at a large discount to its underlying asset value, so we’re getting a good deal by investing at the moment.
Brickworks currently has a fully franked dividend yield of 2.5%, and a 3.6% yield including the franking credits.
