Certain Payments in Uncertain Times: A Look at Dividend Stocks

  • May 16, 2020 AEST
  • Team Kalkine
Certain Payments in Uncertain Times: A Look at Dividend Stocks

The prevailing scenario of COVID-19 pandemic and its aftermath is one in one-hundred-year event affecting almost every sector of the economy, and that is highly reflective on the financial markets around the world. Business operations have come to a standstill, and lack of liquidity has been a concern for businesses. This has laid impact on various aspects of the business, especially dividend distribution. Several companies have rolled back their earnings guidance and have cancelled their dividend payments. While some businesses have resorted to deferment of the dividend to a future date, others have lowered the dividend amount.

The current uncertain times have left the investors in a state of flux, especially the ones who are on the verge of retirement or have already retired and were heavily dependent on dividend income. However, some ASX-listed companies have managed to provide dividends to their shareholders despite the uncertainty in the environment.

GOOD READ: Tips For Scanning Attractive Dividend Stocks Amidst The Current Volatile Market

Let us look at some of the dividend stocks that have paid dividends consistently to their respective shareholders during the current uncertain times.

Coles Group Limited (ASX:COL)

A full-fledged retail Company engaged in the distribution of consumer products, Coles Group Limited, had declared a fully-franked interim dividend of 30 cents per share during 2020 half-year results, consistent with the demerger guidance. The dividend had a record date of 28 February 2020 and was paid on 27 March 2020.

Recently, COL confirmed that it had distributed an interim dividend worth over $400 million to its shareholders during the third quarter of 2020. The Company recorded an increase of 12.9% in its sales revenue to $9.2 billion during the period.

Towards the end of February, the Company experienced impacts on its Supermarket sales growth because of the rising concerns related to COVID-19. However, online sales revenue of the Company grew by 14% during the third quarter of 2020.

By market closure on 15 May 2020, COL shares settled at $15.210, an increase of 1.265% compared to its previous close. COL has a market cap of $20.04 billion and approximately 1.33 billion outstanding shares.

Carsales.Com Limited (ASX:CAR)

The operator of the largest online automotive, motorcycle and marine classifieds business in Australia, Carsales.Com Limited announced an interim dividend of 22.0 cents per share in February representing an increase of 7% on the previous corresponding period.

During the half-year ended 31 December 2019, CAR saw a growth of 5% in its revenue and a jump of 22% in its reported net profit after tax.

More recently, the Company had withdrawn its FY20 outlook statement as an effect of the unpredictability of the current operating environment in the COVID-19 scenario. Moreover, the Company has employed cost-saving measures to moderate the near-term financial impact while also assisting in the short-term performance of the business as well as its long-term strategic priorities and growth plan.

By market closure on 15 May 2020, CAR shares settled at $14.270, an increase of 1.134% compared to its previous close. CAR has a market cap of $3.47 billion and approximately 245.59 million outstanding shares. The Company has an annual dividend yield of 3.29% and P/E ratio of 24.770x.

Wesfarmers Limited (ASX:WES)

A Company with a diverse set of business operations across multiple verticals, Wesfarmers Limited, had announced to pay a fully franked interim dividend of $0.75 per share to its shareholders by the end of March 2020.

While operating during the COVID-19, WES has made remarkable progress in augmenting its respective digital offers while responding to the considerable increase in online sales. Moreover, at the end of March 20202, WES sold its 5.2% interest in Coles for pre-tax proceeds of around $1,060 million to fortify the Company’s balance sheet.

The Company is optimistic about the strength of its balance sheet and the capacity to withstand and respond to a variety of economic circumstances while backing its operating businesses and the search for investment prospects.

By market closure on 15 May 2020, WES shares settled at $37.900, an increase of 0.932% compared to its previous close. WES has a market cap of $42.58 billion and approximately 1.13 billion outstanding shares. The Company has an annual dividend yield of 4.04% and a P/E ratio of 19.640x.

Domino’s Pizza Enterprises Limited (ASX:DMP)

Largest Pizza Chain for Network Store Numbers and Sales in Australia, Domino’s Pizza Enterprises Limited had announced to pay a fully franked interim dividend of 66.7 cents per share to its shareholders on 13 March 2020.

During the COVID-19, DMP has experienced robust sales in stores servicing those same customers who are staying at home and has maintained a healthy balance sheet with significant headroom on its committed debt facilities and covenants and no committed short-term debt.

By market closure on 15 May 2020, DMP shares settled at $57.900, an increase of 0.906% compared to its previous close. DMP has a market cap of $4.95 billion and approximately 86.24 million outstanding shares. The Company has an annual dividend yield of 2.06% and a P/E ratio of 37.670x.

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JB HI-FI Limited (ASX:JBH)

Leading retailer of home consumer products in Australia, JB HI-FI Limited declared an interim dividend (fully franked) of 99 cents per share, which indicated an increase of 8.8% compared to pcp. JBH has an annual dividend yield of 4.28% and a PE multiple of 15.460x, and its recent dividend history is given below:

 

Source: ASX

Source: ASX

 

By market closure on 15 May 2020, JBH shares settled at $34.290, an increase of 0.263% compared to its previous close. JBH has a market cap of $3.93 billion and approximately 114.88 million outstanding shares. The Company has an annual dividend yield of 4.37% and a P/E ratio of 15.140x.

Amcor PLC (ASX:AMC)

A global leader in the packaging industry, Amcor PLC declared a dividend of 11.5 cents per share scheduled to be paid on 17 June 2020 and is committed to a compelling dividend while delivering regular cash flow.

The Company is optimistic about the underlying potential and defensive nature of its business. AMC expects organic growth from defensive end markets, while the EPS is expected to benefit from shares repurchased during the current year. The Company also looks forward to declaring declare dividends every quarter while going forward.

AMC has an annual dividend yield of 4.89% and a P/E ratio of 34.150x. By market closure on 15 May 2020, AMC shares settled at $14.150, an increase of 0.071% compared to its previous close. AMC has a market cap of $22.26 billion and approximately 1.57 billion outstanding shares.

AusNet Services Limited (ASX:AST)

One of the essential players in the Australian utilities sector, AusNet Services Limited declared a dividend of 5.1 cents per share putting the full-year dividend at 10.20 cents per share as compared to a dividend of 9.72 cents per share.

The Company also declared an increase of 6.2% in its FY20 revenues and a rise of 11.7% in its profit before income tax. Moreover, net profit after tax was up by 14.5% driven by growth in AST’s unregulated infrastructure business, regulated price surges, higher gifted assets, and more significant incentive revenues.

By market closure on 15 May 2020, AST shares settled at $1.890, an increase of 0.8% compared to its previous close. AST has a market cap of $6.99 billion, with approximately 3.73 billion outstanding shares. The stock has an annual dividend yield of 5.4% and a P/E ratio of 23.980x.

NOTE: All figures are reported in Australian Dollars unless stated otherwise.

 


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There is no investor left unperturbed with the ongoing trade conflicts between US-China and the devastating bushfire in Australia.

Are you wondering if the year 2020 might not have taken the right start? Dividend stocks could be the answer to that question.

As interest rates in Australia are already at record low levels, find out which dividend stocks are viewed as the most attractive investment opportunity in the current scenario in our report.

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