Why income investors might want to look at Fortescue Metals Group Limited (ASX:FMG) and this high yield ASX dividend share…
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The great news for income investors in this low interest rate environment, is that there are a good number of ASX dividend shares offering generous yields.
Two ASX dividend shares with big yields are listed below. Here’s what you need to know about them:
Charter Hall Social Infrastructure REIT (ASX: CQE)
The first ASX dividend share to look at is the Charter Hall Social Infrastructure REIT. It is a real estate investment trust investing in high quality social infrastructure properties. These are properties with specialist use, limited competition, and low substitution risk. This includes childcare centres and government properties.
It recently released its half year results and reported a 14.1% increase in operating earnings to $29.1 million. Management also revealed other improvements to key metrics. This includes an occupancy rate of 99.7% and a weighted average lease expiry (WALE) of 14 years.
This strong performance allowed the Charter Hall Social Infrastructure REIT board to increase its FY 2021 distribution guidance to 15.7 cents per unit. Based on the current Charter Hall Social Infrastructure share price, this represents a 5.25% yield.
Fortescue Metals Group Limited (ASX: FMG)
Another ASX dividend share to look at is Fortescue. The mining giant has just released its half year results and revealed huge revenue and profit growth.
For the six months ended 31 December, Fortescue delivered a 44% increase in revenue to US$9,335 million and a 66% lift in net profit after tax to US$4,084 million. This was driven by record shipments and a significant rise in the iron ore price. In respect to the latter, Fortescue reported an average realised price of US$114 per dry metric tonne for its iron ore. This was a 42.5% increase on the prior corresponding period.
In light of this impressive performance and its strong balance sheet, the mining giant declared a fully franked A$1.47 per share interim dividend. This is an increase of 93.4% on the prior corresponding period.
According to a note out of Goldman Sachs, it is expecting more of the same in the second half. As a result, based on the current Fortescue share price, it estimates that it offers income investors a fully franked 10.7% yield in FY 2021.
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Returns As of 15th February 2021
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.