Uncertainty and unpredictable events have heightened market volatility in the last few months. This could be an opportunity to buy quality ASX dividend shares.
We can’t know what share prices are going to do – that’s up to the sellers and buyers of shares each day. Thankfully, dividends are usually more stable. But, I do get excited when prices drop because it means we can buy shares at better value. Lower-priced ASX dividend shares come with a higher dividend yield.
In this situation, I’d look at businesses that seem likely to endure, no matter what happens next.
WCM Global Growth Ltd (ASX: WQG)
This is a listed investment company (LIC) which invests in a portfolio of quality companies.
It looks for businesses that the WCM investment team believe have strong and growing competitive advantages/economic moats. In other words, is the ‘edge’ that a company has over competitors growing, stable or weakening? WCM looks for ones that are growing.
WCM also wants to ensure that these businesses have a corporate culture that enables that competitive advantage to continue strengthening and enable larger profits in the future.
Some of the current names in the portfolio include AppLovin, Amazon.com, General Electric, 3i Group and Taiwan Semiconductor.
We can’t rely on past performance to continue, but in the last five years the ASX dividend share’s portfolio has returned an average of 16.3% per year.
The business has a ‘progressive dividend policy’ and has been steadily growing its annual payout since 2021.
It’s about to pay a quarterly dividend of 1.87 cents per share and expects to grow its quarterly payout each quarter to 1.96 cents per share by March 2026. Annualised, that March 2026 payment would amount to a dividend yield of 6.5%, including the franking credits.
It’s currently trading at a 13% discount to its underlying value, the (weekly) net tangible assets (NTA) per share of $1.98 at 28 February 2025.
Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
WHSP is an ideal ASX dividend share in my opinion because of how regularly it has increased the dividend for investors.
It has grown its ordinary dividend every year since 2000, which is the longest record.
While dividends aren’t guaranteed, I think WHSP is set up in a way that is likely to allow the payouts to continue growing for the foreseeable future.
It’s an investment business that is spread across an array of sectors including property, telecommunications, resources, swimming schools, electrification, farming and more.
The business is regularly investing to boost its exposure to other assets/industries and improve its growth outlook, all while paying that growing dividend.
Including the franking credits, WHSP has a dividend yield of 4%.
