2 ASX dividend stocks with BIG yields September 30, 2021
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Investors may be looking for high yielding ASX dividend stocks.
Companies that have relatively low price / earnings ratios (p / e ratio) and higher dividend payout ratios can combine well, resulting in a high dividend yield.
Keep in mind that just because a business pays a dividend doesn’t mean it is automatically worth owning for income. However, at the right price, ASX dividend stocks can be a wise investment.
Here are two to consider:
Nick Scali says he sources home furnishings products all over the world and imports directly from some of the world’s largest and most respected manufacturers.
The ASX dividend share benefited from the strong retail environment and spending for homes.
Management says the company’s future growth will be primarily driven by the deployment of new stores and increased online penetration. It will accelerate initiatives to seize these opportunities. It has 61 points of sale and is targeting 85 in the long term.
Fiscal 22 saw a significant improvement for the company, where revenue increased 42.1% to $ 373 million and underlying net profit after tax (NPAT) increased 100% to $ 84.2 million. Numerous improvements across the business saw the profit margin before interest and taxes (EBIT) increase 940 points to 32.7%.
Nick Scali said he had written online orders of $ 18.3 million in FY21, including $ 5.5 million in the fourth quarter of FY21. The fourth quarter of FY21 was an increase 84% compared to the fourth quarter of FY20. Revenue for the year was $ 15.3 million, with an EBIT contribution of $ 8.8 million.
In fiscal 21, Nick Scali paid an annual dividend of $ 0.65 per share, which translates into a grossed-up dividend yield of 8.2%.
The ASX dividend share is currently considered a buy by broker Citi, with a price target of $ 13.80.
Rio Tinto’s share price has fallen by around 25% since the end of July 2021.
Some analysts see an opportunity, like Macquarie Group Ltd. (ASX: MQG), which classifies Rio Tinto as a buy.
Looking at the FY22 forecast, Macquarie believes the Rio Tinto share price is valued at 5 times the estimated earnings for the next fiscal year. Fiscal 22 could also be accompanied by a dividend yield increased by 15.7%.
The FY21 result was a total dividend of $ 5.61 per share, which included an ordinary dividend of $ 3.76 per share (up 143%) and a special dividend of 1.85 USD. This happened after a very big increase in profits and cash flow. Free cash flow in 1H21 increased 262% to US $ 10.2 billion and underlying profit increased 156% to US $ 12.2 billion.
Compared to many other miners, this share of ASX dividend is diversified and not totally dependent on a single product. Rio Tinto explains:
We produce iron ore for steel, aluminum for cars and smartphones, copper for wind turbines, diamonds that set the standard for “responsible”, titanium for household products and borates for consumers. cultures that nourish the world.
He also has a long-term lithium project in Europe called Jadar on the cards. It could provide enough lithium to power more than a million electric vehicles a year.