Insights

Should CSL (ASX:CSL) be your next dividend share?

Should CSL Limited (ASX: CSL) be your next ASX dividend share? The 1.04% yield may look paltry, but sometimes it’s the growth that counts.
The post Should CSL (ASX:CSL) be your next dividend share? appeared first on The Motley Fool Australia. –

asx share price dividend payments represented by man holding $50 note close to his face

CSL Limited (ASX: CSL) has never had much of a reputation as an ASX dividend share. Especially when compared to its companions in the upper echelons of the S&P/ASX 200 Index (ASX: XJO). Think about it. CSL is now the third-largest ASX 200 share by market capitalisation. Gold and silver go to Commonwealth Bank of Australia (ASX: CBA) and BHP Group Ltd (ASX: BHP). And below CSL are the other 3 remaining big banks.

All of these other companies are (or at least were, pre-COVID) dividend heavyweights.

And yet CSL has never enjoyed such a reputation. Even today, the company offers a trailing dividend yield of 1.04% – not really ‘set the world on fire’ stuff. And that’s not even following a COVID-induced dividend cut from last year. In fact, 2020 saw CSL dole out its highest dividends in history with a combined US$2.02 per share payout. 2021 so far has seen an interim dividend of US$1.04 per share, healthily exceeding 2020’s interim dividend of 95 cents.

CSL’s dividend growth

CSL has been around in some form for over a hundred years. But it only paid its first dividends in 2013. That was a combined payment of US$1.02 per share. That means that CSL has grown its annual dividend since 2013 by a compounded annual growth rate of 10.25% per annum.

Here’s an interesting number for you. Back in October 2013, when CSL paid its first final dividend, CSL shares were going for roughly $66 apiece. Using today’s exchange rate, that would have equated to a rough annual yield of around 2% at the time for an investor who picked up CSL back then. But if that investor held those CSL shares until today, the yield they would have gotten on their original investment would be around 4% today with CSL’s dividend growth.

That’s the power of a compounding growth rate. If CSL continues to increase its dividends by an average of 10.25% every year, that yield-on-cost will only grow larger, and exponentially so, in the years ahead.

So although a 1.04% trailing dividend yield might look a little paltry, CSL’s history of strong dividend growth proves that sometimes it’s not just size that matters.

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

Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. 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 Should CSL (ASX:CSL) be your next dividend share? 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!