5 Biggest Gainers – ASX Dividend Stocks For November 2021
The ASX 200 finished today’s session 91.5 points or 1.25% higher at %7,405.40, extending gains for the fourth consecutive session as traders cheered a strong relief rally on Wall Street overnight while higher iron ore and oil prices supported major miners and energy stocks.
Our List of ASX Top Performed Dividend Stocks
Are you looking for some quality dividend shares to buy in December? If you are, then you may want to look at these five high yield dividend shares listed below.
Rural Funds Group (ASX: RFF)
Rural Funds is a real estate investment trust that owns a large and growing portfolio of farming properties across the country. The company has a goal of growing the distribution by 4% each year for investors, which this REIT has done so for several years since it is listed. That objective is driven by contracted rental increases as well as productivity investments.
Rural Funds has farms across several sectors: cattle, vineyards, almonds, macadamias and cropping.
At the end of November 2021, Rural Funds announced another acquisition. The group is buying 27,879 hectares of cattle and cropping farms across four properties in Queensland. We think that those acquisitions have significant potential for productivity improvements. This includes the purchase of 12,448 ML of water entitlements, which will be used to improve productivity, including expanding irrigated cropping areas and increasing cattle carrying capacity through pasture improvement and additional water points.
With such a positive operating outlook, Rural Funds is expecting to pay an FY22 distribution of 11.73 cents per unit, translating to a distribution yield of 4%. The company expects to generate adjusted funds from operations of 11.8 cents per unit in FY22.
Metcash Limited (ASX: MTS)
Another interesting dividend stock is Metcash. Metcash is a business with operations across food, liquor, and hardware. The company supplies IGAs across the country and it is the second biggest hardware player in the country with Mitre 10, Home Timber & Hardware and Total Tools. The company is currently well rated by various brokers and analysts.
We think that Metcash is currently a good value and could pay a grossed-up dividend yield of 7.1% in FY22. The solid dividend is supported by Metcash robust fundamentals. Hence, the company’s share price is valued at circa 15 times FY22’s estimated earnings.
Metcash did just report its FY22 half-year result, which came with a 31% increase to the interim dividend to 10.5 cents per share after a 15% increase to its underlying earnings per share to 14.6 cents.
Metcash has successfully completed its off-market buy-back of $200 million. The company now has a target dividend payout ratio of 70% of underlying profit after tax.
The second half of FY22 has seen sales growth continue, with hardware sales increasing 20.1% and playing an important part in profit generation for the business.
Adairs Ltd (ASX: ADH)
Adairs is another interesting dividend share to look at. It is the leading homewares and furniture retailer behind the Adairs and online-only Mocka brands. The company has recently signed an agreement to acquire Focus on Furniture for $80 million. Focus currently operates twenty-three stores across Australia. Adairs has generated revenue greater than $150 million during the financial year 2021.
We are pretty positive about the deal. Hence, Adairs believes that this acquisition will complement its core business and provide network expansion opportunities.
We are also expecting Adairs to offer fully franked dividends per share of 23 cents in FY22 and 29 cents onwards FY23. Based on the current Adairs share price of $3.57, this will mean impressive yields of 6.4% and 8.1%, respectively.
BHP Group Ltd (ASX: BHP)
One of the most solid dividend stocks that everyone should have in their portfolio is obviously BHP. Whilst recent weakness in the BHP share price has been disappointing for investors, instead, we believe this could be a buying opportunity.
We are expecting BHP to distribute fully franked dividends of $3.4 per share in FY22 and $2.44 per share in FY23. Based on the current BHP share price of $39.95, this will mean remarkable yields of 8.5% and 6.1%, respectively.
Whilst there are more leveraged plays sensitive to a global recovery scenario, we see BHP as holding an attractive combination of upside sensitivity, balance sheet strength and resilient dividend profile.
Coles Group Ltd (ASX: COL)
Last but not least is Coles. Coles is of course one of the big two supermarket operators. This defensive champion could be a top option for income investors. Hence, the business exhibits solid growth prospects, and focus on automation.
In respect to the latter, Coles is constructing new smart distribution centres with automation giant Ocado to cut costs and boost its online business. If all goes to plan, Coles will be a much stronger business and well-placed for the future.
We are pretty positive about Coles. We expect the company to deliver solid earnings and dividend growth over the coming years. This could translate into lucrative fully franked dividends of 65 cents per share in FY22 and eventually 72 cents per share onwards FY23. In our view, dividends will continue to grow to 77 cents per share by FY24.
Based on the current Coles share price of $17.81, this will mean yields of 3.65%, 4%, and 4.3%, respectively.