Insights

3 ASX dividend shares to buy with yields above 5%

There are some ASX dividend shares that have yields of more than 5% such as footwear retailer Accent Group Ltd (ASX:AX1).
The post 3 ASX dividend shares to buy with yields above 5% appeared first on The Motley Fool Australia. –

blockletters spelling dividends bank yield

A number of ASX dividend shares have quite high yields, so they could be worth looking at if investors are searching for income.

Not every business has a big yield. Some ASX shares have high valuations, which pushes down the prospective yield. Other stocks have lower dividend payout ratios and that obviously doesn’t help the yield. 

These three ASX shares have relatively high yields:

Nick Scali Limited (ASX: NCK)

Nick Scali is rated as a buy a few brokers, including Citi – it has a price target of just over $12 on the business. According to Citi’s prediction, the furniture retailer is going to pay a dividend of $0.80 per share for FY21, which translates to a grossed-up dividend yield of 11.4%.

The latest Nick Scali dividend – the FY21 interim one – was increased by 60% to $0.40 after a strong first half where sales increased 24.4% to $171.1 million and a doubling of underlying earnings per share (EPS) to 50 cents.

Consumer spending has been focused on their homes rather than things like holidays during this difficult COVID-19 period.

The ASX dividend share’s margins improved significantly as the company discounted less and ensured spending was disciplined. The underlying earnings before interest and tax (EBIT) margin improved by 1,270 basis points to 33.6%.

The sales order bank at the end of January was the highest of all time, suggesting further sales growth for the rest of FY21.

Accent Group Ltd (ASX: AX1)

Accent is a footwear retailer which sells a number of different brands through over 500 stores. It has over 100 stores under each brand of The Athlete’s Foot, Platypus and Skechers. It’s expecting to open at least 90 stores in FY21 across all banners.

Whilst the retailer only grew its total sales by 6.6% in the first six months of FY21, online sales soared 110% to $108.1 million and this represented 22.3% of total sales.

Margins improved considerably for the business, with underlying earnings before interest, tax, depreciation and amortisation (EBITDA) going up by 44% to $97.5 million. EBIT went up 47.3% to $81.8 million and net profit after tax (NPAT) grew 57.3% to $52.8 million.

It was the above numbers that gave the board the confidence to increase the interim dividend by 52.4% to 8 cents per share.

Citi rates Accent as a buy and thinks it’s going to pay a grossed-up dividend yield of 7.6%. The company continues to invest for more growth, particularly with its store rollout and online capabilities.  

Charter Hall Long WALE REIT (ASX: CLW)

This is a real estate investment trust (REIT), it’s one of the larger ones on the ASX and it has one of the longest weighted average lease expiry (WALE) statistics on the ASX at 14.1 years.

It was the strong and stable tenant base that allowed Charter Hall Long WALE REIT to increase its distribution last year, unlike most other ASX REITs.

This ASX dividend share has good tenants such as various Australian government entities, Telstra Corporation Ltd (ASX: TLS), Woolworths Group Ltd (ASX: WOW), Ingham’s Group Ltd (ASX: ING), Coles Group Ltd (ASX: COL), Westpac Banking Corp (ASX: WBC) and Wesfarmers Ltd (ASX: WES).

Charter Hall Long WALE REIT’s rental income is slowly but steadily growing thanks to rental indexation that’s either fixed or linked to CPI inflation, as well as acquisitions. It had an occupancy rate of 97.5% at 31 December 2020.

In FY21 the REIT is expecting operating EPS to grow by at least 2.8% to no less than 29.1 cents per security. With a distribution payout ratio of 100%, that represents a FY21 yield of at least 6.2%. It’s currently rated as a buy by Morgan Stanley with a price target of $5.35.

These Dividend Stocks Could Be Your Next Cash Kings (FREE REPORT)

Motley Fool Australia’s Dividend experts recently released a brand-new FREE report revealing 3 dividend stocks with JUICY franked dividends that could keep paying you meaty dividends for years to come.

Our team of investors think these 3 dividend stocks should be a ‘must consider’ for any savvy dividend investor. But more importantly, could potentially make Australian investors a heap of passive income.

Don’t miss out! Simply click the link below to grab your free copy and discover these 3 high conviction stocks now.

Click Here For Your Free Stock Report

Returns As of 15th February 2021

More reading

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia owns shares of COLESGROUP DEF SET, Wesfarmers Limited, and Woolworths Limited. The Motley Fool Australia has recommended Accent Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post 3 ASX dividend shares to buy with yields above 5% appeared first on The Motley Fool Australia.

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!