I think September is a great time to buy ASX Dividend Shares.
We have seen most of the results in the August 2020 reporting season. So now we have a good idea of how difficult businesses are COVID-19 Period.
Businesses that can grow (or maintain) dividends these days are truly the best ASX dividends stocks. But they should be at a good price to buy them today.
That is why I am personally interested in these two ASX dividend shares in September:
Future Generation Investment Company Limited (ASX: FGX)
Future Generation A Listed Investment Company (LIC). I think this is a special LIC because it has no administrative fees and instead donates 1% of its net assets to youth charities every year.
What does it invest in? Future generation ASX invests in the funds of other fund managers who buy shares. Those fund managers work for free to pay donations.
The useful thing about LICs is that they generate investment returns and then pay those profits into a fixed (growing) dividend.
Looking at the overall portfolio performance of future generations over the past five years, it has surpassed the S&P / ASX All Normal Accumulation Index by 2% per annum.
It has been increasing its dividend every year since 2015 when it first started paying a dividend. It did not grow fast, but steady income growth was attractive.
At current Future Generation stock prices, ASX Dividend share yield is 6.9%. In addition to good yields, I also like future generations because it trades at 8.3% discount on net fixed assets (NDA) in July 2020. Buying LIC at a discount with long-term performance is attractive to me.
Washington h. Soul Pattinson & Co. Ltd (ASX: SOL)
I think Soul Bates is the gold standard for dividends on ASX. I believe every Aussie income investor should have Soul Bates in their portfolio.
ASX has been increasing its dividend every year for the past two decades.
How was it managed? Well, it’s an investment partnership with a diverse portfolio with mostly defensive businesses. Such as its reserves DPG Telecom Limited (ASX: TPG), Brickworks Ltd. (ASX: BKW) And New Hope Corporation Limited (ASX: NHC) Send dividends to Soul Bates, which can then be paid to shareholders, while retaining a portion to invest in new opportunities.
The annual cash flow benefits of the ASX dividend share are invested in new businesses from retained net cash, and current reserves that grow its dividend.
Soul Bates has paid a dividend every year since it was listed 1903. That is, dividends continue to come to shareholders through World Wars, the Spanish flu, the depression of the 1930s and more.
I like trying to identify Soul Bates investment opportunities. For example, I think swimming schools, one of Soul Bates’ private investments, will be a reliable business even during a non-epidemic recession because parents want their children to learn to swim.
Over time, I think Soul Bates will be able to grow its dividend for many years to come because it makes long-term investments of its own. ASX dividends can change their portfolio smoothly as it transforms into new opportunities. It will soon be invested in regional data centers as part of a long-term growth.
It offers a gross dividend yield of 4.15% of the current Soul Bates share price.
I really like these two ASX dividend stocks and that is why I keep them in my portfolio. They offer solid start-up yields, have a history of dividend growth and have good portfolio diversification. Future generation is ideal for people who want high start-up yields, but would love to buy Soul Bates for its long-term growth record and sustainable capital growth.
Where to invest $ 1,000 now
When investment expert Scott Phillips has a stock tip, you can pay to hear it. After all, the premier Motley Fool Share Share Advisor newsletter he has run for more than eight years has offered two, three or more stock options to thousands of paying members. *
Scott expressed what he believed Five Best ASX Shares Investors should buy now. These stocks are trading at dirty-cheap prices, and Scott considers them to be the biggest buy now.
* Will be back by June 30th
Motley is stupid Contributor Tristan Harrison FUTURE GEN FPO and Washington H. Soul holds shares in Pattinson & Company Limited. Motley Fool holds shares in Australia and is owned by Brickworks and Washington H.C. Recommended the recommendations of Soul Pattinson and Company Limited. Fools We should not all have the same opinions, but we all believe that one opinion should be considered Different types of intelligence Makes us better investors. Motley is an idiot Disclosure policy. This article contains only general investment advice (under AFSL 400691). Recognized by Scott Phillips.