Insights

2 ASX shares that could keep growing the dividend every year

Soul Patts is one of the ASX dividend shares that may be able to grow the dividend every year.
The post 2 ASX shares that could keep growing the dividend every year appeared first on The Motley Fool Australia. –

ASX dividend shares can be an effective way to generate income. But there are some businesses that may have the potential to continue to increase the dividend in the future.

Companies that were previously demonstrating a record of consistent or growing dividends faced difficulties when COVID-19 came along.

However, there is a small group of businesses that have the potential to continue to grow their dividends (as they have been doing):

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts is the ASX dividend share with the longest record when it comes to dividend increases. The business has grown its dividend every year since 2000. There are very few companies that have grown their dividend for more than 10 years in a row on the ASX.

The Soul Patts portfolio is an important part of how it has continued with that dividend growth record.

It owns a number of different investments where it has a material amount of money invested including: TPG Telecom Ltd (ASX: TPG), Brickworks Limited (ASX: BKW), New Hope Corporation Limited (ASX: NHC), Australian Pharmaceutical Industries Ltd (ASX: API), Clover Corporation Limited (ASX: CLV), Tuas Ltd (ASX: TUA), Pengana Capital Group Ltd (ASX: PCG) and Pengana International Equities Ltd (ASX: PIA).

There are also non-ASX investments in the portfolio such as agriculture, resources, swimming schools and retirement living which provide diversification and more investment opportunities.

This investment portfolio provides the ASX dividend share with investment income. After paying for expenses, Soul Patts is able to re-invest the remaining operating cashflow into other opportunities. Private equity and international shares are two areas that Soul Patts has identified as potential places it’s looking.

At the current Soul Patts share price, it has a grossed-up dividend yield of 2.3%.

Charter Hall Long WALE REIT (ASX: CLW)

This ASX dividend share is a real estate investment trust (REIT). It owns a diversified portfolio of different properties which are all on long-term leases.

In terms of the different sectors, it is spread as follows: 33% in long weighted average lease expiry (WALE) retail, 22% in industrial and logistics, 25% in office, 15% in social infrastructure and 5% in agri-logistics.

Some of the tenants that are currently using Charter Hall Long WALE REIT’s properties includes names like the Australian Government, Telstra Corporation Ltd (ASX: TLS), BP and Endeavour Group Ltd (ASX: EDV).

Prior to a recent potential acquisition, the ASX dividend share had an occupancy rate of 98.3% with a WALE of 13.2 years. The REIT says that income growth is driven by annual rent increases in all leases. In the FY21 result it said that it has inflation protection with 40% of leases linked to CPI inflation and 60% of leases fixed with an average fixed increase of 3.1%.

It’s currently looking to take over ALE Property Group (ASX: LEP) alongside a consortium. This deal would lead to its number of properties rising to 550, whilst the property value went up to $6.5 billion.

In FY22, it’s expecting its operating earnings per share (EPS) to grow by at least 4.5% compared to FY21. It pays a distribution payout ratio of 100% of operating earnings.

It’s currently rated as a buy by the broker Citi, with a price target of $5.59. Citi is expecting the REIT to pay a distribution of 31.10 cents per share in FY22, which equates to a distribution yield of 6.3%.

The post 2 ASX shares that could keep growing the dividend every year appeared first on The Motley Fool Australia.

Should you invest $1,000 in Soul Patts right now?

Before you consider Soul Patts, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Soul Patts wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

When was the worst ever day on the Telstra (ASX:TLS) share price chart?
Why this broker sees 30% upside for the AGL (ASX:AGL) share price
2 ASX dividend shares with fully franked yields of more than 5% today

Did Optus just get a better deal than Telstra (ASX:TLS) for its towers?
4 ASX shares looking ripe for the picking now

Motley Fool contributor Tristan Harrison owns shares of Pengana International Equities Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Brickworks and Clover Corporation Limited. The Motley Fool Australia owns shares of and has recommended Brickworks and Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!