The ASX gained 0.6% today as the Energy sector was once again the best performer on the back of surging oil prices. All sectors ended the day in green except consumer discretionary stocks, which declined by 0.1%. Redbubble was the worst performer, falling 6.9%.
This week, the RBA also took the opportunity to emphasise that interest rates are set to stay low until 2024, as planned earlier. This means dividend income is crucial for investors and here are the top 2 dividend shares to buy now!
ANZ is an Australian multinational banking and financial services company that operates in 33 markets globally.
Coming off an extremely difficult year for the banks and investors in banks with dividends being cut, ANZ’s interim dividend for 2021 was 70 cents. The company’s strong earnings, improving environmental conditions and a combination of their strong capital management has given them the confidence to pay this interim dividend.
In H1FY21, ANZ’s statutory profit after tax was up by 45% at $2.9mn, driven by a net credit provision release of $491mn. This makes ANZ a considerably strong contender for the best income stocks on the ASX.
The company has not faced any large credit losses due to the pandemic. In fact they have $4.3bn in their reserve if conditions deteriorate. The company’s capital position and strong balance sheet gives them the flexibility to return surplus capital to shareholders.
With low interest rates continuing to offer favourable operating environments, the run for the banks does not look like it’s over yet. ANZ is one stock that fits into most investor portfolios.
ANZ shares closed at $27.87 a share, gaining 0.9% in trading today.
Furniture retailer Nick Scali has also been a solid performer during the pandemic. NCK shares have gained 39% in the past year and 21% in 2021. NCK announced it FY21 earnings earlier last month and delivered an impressive performance. EBITDA was $126.6m, and NPAT was $84.2m – above recent guidance on 4 May 2021 of $78-80m.
Sales revenue for the year grew by 42% to $373.0m, with same store sales revenue growth of 34%. Total written sales orders for the year were $401.6m and continued to outstrip sales revenue, resulting in an end of year order bank 35% higher than at 30 June 2020.
Gross profit margin for FY21 was 63.5%, compared to 62.7% in the prior year. This result was achieved despite rising freight and supply chain costs experienced throughout the year.
The directors have declared a fully franked final dividend of 25.0 cents per share, with a record date of 4 October 2021 and a payment date of 25 October 2021. This brings the full year dividend to 65.0 cents per share and represents a payout ratio of 63%.
NCK shares still have legs for growth and with a dividend yield of 5.51%, Nick Scali is a top dividend share to buy on the ASX. NCK shares closed at $11.75 a share today.