2 ASX dividend shares with yields above 5%

The 2 ASX dividend shares in this article have income yields above 5%. One example is Charter Hall Long WALE REIT (ASX:CLW).
The post 2 ASX dividend shares with yields above 5% appeared first on The Motley Fool Australia. –

large goklden symbol of 5% representing yield of dividend shares

There are some ASX dividend shares that have dividend yields above 5%.

A yield of more than 5% is much higher than the current Reserve Bank of Australia (RBA) yield.

Charter Hall Long WALE REIT (ASX: CLW)

This is a real estate investment trust (REIT) which owns a diversified portfolio of different properties.

It’s invested across a number of different industries including long WALE retail (weighted average lease expiry), industrial and logistics, office, telecommunication exchanges and agri-logistics.

The business just reported its FY21 half-year result. At 31 December 2020, it had 459 assets with a valuation of $4.48 billion. Its WALE grew by 0.1 year to 14.1 years. Its occupancy rate was 97.5%.

Some of its most recent acquisitions include the David Jones property in the Sydney CBD and 70 BPs in New Zealand.

The business said that its distribution for the half year was increasing by 3.6% to 14.5 cents per unit. The net tangible assets (NTA) of Charter Hall Long WALE REIT increased by 5.1% to $4.70 per unit.

Charter Hall Long WALE REIT said that its operating earnings per share (EPS) for FY21 is still expected to be no less than 29.1 cents per unit, which would be growth of at least 2.8%. That translates to a FY21 distribution yield of at least 6.1%.  

JB Hi-Fi Limited (ASX: JBH)

JB Hi-Fi is one of the biggest retailing businesses on the ASX. It operates JB Hi-Fi Australia, JB Hi-Fi Australia New Zealand and The Good Guys.

The ASX dividend share has been steadily growing its dividend each year for the past several years.

JB Hi-Fi has seen elevated levels of sales growth ever since the COVID-19 pandemic hit as consumers looked for ways to learn, work and be entertained at home.

FY20 saw total sales go up 11.6%, underlying earnings before interest and tax (EBIT) grew by 30.5% to $486.5 million and underlying EPS went up 33.2% to 289.6 cents.

That result saw the company increase its final dividend by 76.5% to 90 cents per share and the total FY20 dividend went up by 33.1% to 189 cents per share.

At the current JB Hi-Fi share price, that means it has a grossed-up dividend yield of 5.2%.

JB Hi-Fi recently gave an update for its FY21 first half result which showed that sales are expected to be up 23.7% to $4.94 billion, EBIT was up 75.9% and net profit was up 86.2% to $317.7 million. Online sales grew by 161.7% to $678.8 million, representing 13.7% of total sales. JB Hi-Fi said that a well-executed Black Friday promotional period more than offset the impact of the government mandated temporary store closures during the half.

The ASX dividend share said that gross margins improved significantly in key categories, particularly in The Good Guys. However, this was somewhat offset by the sales mix at JB Hi-Fi Australia and JB Hi-Fi New Zealand.

JB Hi-Fi said that disciplined cost control combined with strong sales growth to drive significant operating leverage.

The company continued to pay landlords and team members throughout the half, including periods where stores were temporarily closed.

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Motley Fool contributor Tristan Harrison 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.

The post 2 ASX dividend shares with yields above 5% appeared first on The Motley Fool Australia.

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