The ASX 200 Index has been flat for the past month. There seems to be uncertainty in the markets regarding the macro-economic data that has been coming through. Today, the ASX 200 shrugged off the best unemployment numbers we have received in the last decade and ended the day in the red – closing at 7335.9 points – dipping by 0.26%. Healthcare and Technology underperformed today – dipping by 1.4% and 1.2%, respectively. Once again, it was the Materials sector that was the best performer – gaining 1.4%. Given the current market conditions, here are some of the best dividend stocks on the ASX, for you fellow income chasers.
Outside of the Big 4 banks, Suncorp, BOQ, and Bendigo have been performing well. These regional banks also have a relatively positive growth profile than the likes of CommBank, Westpac, NAB, and ANZ. SUN operates through banking and insurance segments, after recently selling their wealth business. It has its own brand of products but also operates under names like AAMI, GIO, Apia and Shannons.
Unlike the rest of the banks, SUN shares have not had a straightforward run as the economy roared back to life. It is because of its exposure to the insurance segment in addition to banking. Severe weather conditions and the likes affect the profitability of the business and SUN shares are usually in the spotlight when there are claims of this nature on the horizon.
Suncorp, much like the entire banking sector, had a fantastic half-year performance. Their cash earnings were up 39% and NPAT was up 23.7%, resulting in fully franked interim dividends of 26 cents a share. There was strong top-line growth in the Consumer and Commercial portfolios in both the Australian and New Zealand insurance businesses, higher investment returns and prior year reserve releases underpinning the positive performance.
With a favourable operating environment, SUN shares are expected to keep their run going and the full year result is expected to be largely positive, with another healthy dividend payout. The SUN share price today closed at $11.39 a share, with a dividend yield of 3.18% – making it another contender for the top dividend stocks on the ASX.
Adairs prides itself as a specialty retailer of homeware and furnishings. They are headquartered in Melbourne, have been around since 1918 and operate in Australia and New Zealand. Adairs is Australia’s largest omni channel retailer in their space. They operate under brands – Adairs, Adairs Homemaker, Adairs Kids, Urban Home Republic, and Mocka, New Zealand based furniture company that caters to baby, kids, and nursery products and now home furnishings. Adairs acquired Mocka in December 2019 and the acquisition has largely been a hit. Mocka increased revenues through online channels for Adairs.
The ADH share price has fallen way off the highs it was trading at just a month ago. There has not been any structural changes within the company either. The company has also shown resilience in operating during lockdowns. During the first wave of Covid19, Adairs had 43 of their Melbourne stores closed for close to half the period in H1 FY2021. However, the firm still reported a growth in group sales of 34.8%. The total revenues earned during the period was $243 million, out of which $90.2 million can be attributed to online sales.
ADH shares currently trade at $3.75 a share – dipping over 22% in the past month. The dividend yield is currently 6.22% and given how fundamentally strong Adairs is, ADH shares just look unloved at this moment and a recovery in ADH share price is definitely on the cards.
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