How to find the Best ASX Dividend Stocks
You want to find the best ASX dividend stocks to boost your income? ASX investors don’t just look for dividend stocks but they also look for capital growth. Many investors will go straight to ASX Blue Chip stocks for dividends.
Investing for Growth with a Dividend
Our focus is on investing for growth. But that doesn't mean that you won't get income too. In 2008 our ASX Small Cap portfolio manager invested in the Small Cap stock TPG for below 60 cents. In 2020 he is receiving a special dividend of between 49-52 cents per share. What ASX investors are receiving now is a dividend that’s close to the entire value of the The Idle Speculator's initial investment. This can only be achieved through ASX Small Cap stocks.
Dividend paying ASX Small Caps can give you income through dividends plus share price growth potential.
Invest in ASX dividend stocks for the long-term
Consider investing in ASX dividend stocks for the long-term because you can grow your capital and get income from the dividend payment too.
When a Small Cap stock pays dividends, it shows that the Small Cap is a quality investment and represents an important price signal for the stock market. When there is increased uncertainty and the stock market comes under pressure, if the Small Cap is able to maintain and even increase dividends, this augurs well for your portfolio’s ability to weather the storm.
More than 50% of the small cap stocks we cover have a dividend yield
Of the 100 small cap stocks that Under the Radar Report actively covers for our stock report more than 50% of these small companies give dividends. Small Caps can give ASX investors a cash return but they also offer real growth potential.
Dividends can be a handy addition to your income or indeed for retirees form the bulk of their income and over 50% of our current small cap stocks are providing dividends for subscribers.
Why is growth important?
Growth is important because you want your investment to grow. Big Companies grow but often at a much smaller rate. For small companies it is much easier to double, or triple in price because they are so much smaller to start with.
Our team of analysts has done the hard work for you and found the best ASX dividend stocks for you to invest in. The question becomes do you invest in Blue Chip stocks or Small Cap stocks and the answer is both. You need small caps for growth and dividend yield and blue chips for dividend yield. But diversification is very important.
Remember to look at our All Stock Research tabs online to see the shares that are the best ASX Dividend stocks. You can login online when you have a current free trial with us. You are given full access to all our research for 30 days. Learn how to structure a diversified portfolio now.
Small Cap stocks offer investors on the ASX strong capital growth, but many of them also offer dividends as well. There are over 2,200 small cap stocks listed on the ASX and at Under the Radar Report we hunt for small cap stocks for our small cap stock report that will boost your portfolio’s returns through growth. That’s right, we are looking not just for a dividend return but also for share price growth.
Our team is very experienced and we have a strong record over the past eight years of delivering independent fundamental analysis on over 100 small cap stocks. Many sites are simply PR for small companies but Under the Radar Report is an established independent research house with its own AFSL.
Our analysts sole purpose is to research companies that will make money for our subscribers. They work hard to filter through all the small cap stocks on the ASX to find stocks that offer dividends and provide growth.
Read more about what small caps can do for your portfolio.
Blue Chip Stocks: Best ASX Dividend Stocks
Under the Radar’s Blue Chip Value stock report covers over 40 of the Best ASX Dividend Stocks. Our team of analysts have hunted for the best dividend stocks for your share report. All of the 40 Blue Chip stocks we cover give ASX investors dividends. The highest dividend yield is a very healthy 9.5%. We also give clear Buy, Sell and Hold recommendations making it very clear for you to know what to do.
We advise that up to 50% of your share portfolio should be invested in a number of Blue Chip stocks not only for their dividend yield but also as they can be a relatively safe investment. (but all stocks can go up and down so watch them!).
Still not convinced?
There are risks in investing in ASX shares, but the ASX Small Cap dividend stocks we recommend have delivered an annual cash yield of up to 5% before you include franking credits, rather than a yield of 2% from a Government bond. Plus, you get capital growth potential, unlike a bond or bank deposit.
Investing in the stock market is all about building a portfolio of 7-15 ASX stocks that will give you a combination of income and growth. It is also about minimising your risk through diversification.
The great thing about Small Caps is the variety of different sectors on offer, which is sharply contrasted by the concentration of exposure in the ASX 200 to banking and resources. For example, you don't want to invest in only two companies which operate in the same sector. Don't put all your eggs in one basket!
If you re-invest your dividends this will work to supercharge your returns over the long-term. Albert Einstein is rumoured to have said that compound interest is the eighth wonder of the world, but we doubt this. Even so, you can see its effect when you reinvest dividends. If you invested $1000 and achieved an 8% annual return every year over forty years, made up of 3% dividends and 5% capital gain, this would have appreciated to $21,720 with re-invested dividends and $7,040 without re-investment.
A strong balance sheet is most important. We have invested in a number of companies (including two in media and one in contracting) that made efforts to repair their balance sheets by forgoing dividends. These companies subsequently delivered great cash flow.
Try finding a term deposit that has a rate above 2.5% where your money is not locked up. You can’t get 2% from a govt bond. Even if you do, you’re taking price risk. If interest rates go up, the value of your bonds goes down.
Small Caps pay dividends too
Under the Radar Report researches over 100 Small Caps. 50% of these Small Caps pay investors dividends.
Our Blue Chip Value Price Target methodology, is based on two investment models that rely on each company’s investment fundamentals and consensus forecasts for earnings and dividend payments. They are also based on long-standing and validated valuation theory principles.
We also give you a crib sheet, covering the investment summary of over 40 Blue Chip stocks, which includes the price target, expected 12-month return (target opportunity), our Radar Rating, and comment. From valuation theory practicalities that make the Blue Chip Value Model work, it provides a great base from which to generate price targets to help you manage your Blue Chip portfolio and to find buying opportunities.
Read more about our Blue Chip ASX Stocks with dividends.
Find out the return expectations for over 40 Blue Chip Stocks
We also give you Price Targets which is the price we believe the stock will be in 12-months time. This is run by a very experienced analyst Sam Ferraro. Not only can Blue Chip Value subscribers now search for our latest views on every one of the Blue Chip Shares we cover, but we have now added a valuation based Price Target for each of these ASX Dividend stocks, which enables you to gauge what our return expectations are.
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