Super Retail and Charter Hall Retail REIT are two ASX 200 dividend shares.
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The two S&P/ASX 200 Index (ASX: XJO) shares in the article are expected to pay a relatively high dividend yield in FY22.
Some businesses have been impacted heavily by COVID-19, but some of them are still generating a high level of cashflow which can fund cash returns to shareholders.
These are two ASX 200 dividend shares that might offer a higher yield for investors in 2021:
Charter Hall Retail REIT (ASX: CQR)
This is one of the larger real estate investment trusts (REIT) on the ASX. As the name may suggest, it specialises in owning retail properties.
It’s currently rated as a buy by the brokers at Macquarie Group Ltd (ASX: MQG) with a price target of $4.18. Macquarie expects that the ASX 200 dividend share will pay a FY22 distribution of 25.6 cents, translating into a forward distribution yield of 6.8%.
At 30 June 2021, its portfolio valuation was around $3.65 billion with a weighted average capitalisation rate of 5.8%. It recently had its portfolio revalued which saw an increase of $143 million, or 4.1%, uplift on prior book values.
It has shopping centre convenience retail properties and the REIT’s long weighted average lease expiry (WALE) retail portfolio comprises BP and Coles Group Ltd (ASX: COL) Adelaide distribution centre.
Charter Hall CEO Greg Chubb said:
Our shopping centre portfolio has proven is resilience through the challenges of the last 12 months with strong occupancy, rent collection and retail sales growth. This is now being reflected in asset valuation gains.
Our Long WALE convenience retail assets remain highly attractive given the quality of the tenants, attractive lease structures, duration of leases and high underlying land values. These assets have delivered Charter Hall Retail REIT unitholders highly defensive and reliable earnings over the last twelve months and are now also delivering significant growth in capital values. It’s pleasing to see the results of our on-going portfolio curation delivering these gains.
Its net tangible assets (NTA) is now $4.02.
Super Retail Group Ltd (ASX: SUL)
Super Retail is one of the larger retail businesses on the ASX with a few chains of stores including Supercheap Auto, Rebel Sport, BCF and Macpac.
Credit Suisse thinks the ASX 200 dividend share is a buy, with a price target of $14.45.
The broker thinks that Super Retail will pay a dividend of 49.2 cents in FY22, which represents a grossed-up dividend yield of 5.6%.
In the latest trading update, the business said that it had seen double digit like for like sales growth across each of its businesses, with total growth of 28%.
Due to the continued strength of customer demand, Super Retail has maintained relatively subdued levels of promotional activity in the second half. As a result, the gross profit margin improvement which the group delivered in the first half has been maintained in the second half. It also has a well-stocked inventory position.
Online sales continue to grow as a percentage of overall sales. The contribution margin per transaction is significantly higher for online sales than for in-store sales. Its active club membership continues to grow, with active club members making up a larger percentage of total sales.
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Returns As of 15th February 2021
Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended COLESGROUP DEF SET, Macquarie Group Limited, and Super Retail Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.