Top 8 ASX dividend shares

Morning Star AU09-16

Building passive income through dividend shares takes more looking for the highest yield shares. The pathway to creating a growing income stream is balancing higher yields and future dividend growth. ...

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The pathway to creating a growing income stream is balancing higher yields and future dividend growth. ...</p>\n\n<a href=\"https://www.morningstar.com.au/insights/personal-finance/254146/top-8-asx-dividend-shares\">Source Link</a>\n\n</div>\n","source":"morningstar_stock","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Top 8 ASX dividend shares</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nTop 8 ASX dividend shares\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-09-16 00:00 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.morningstar.com.au/insights/personal-finance/254146/top-8-asx-dividend-shares><strong>Morning Star AU</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Building passive income through dividend shares takes more looking for the highest yield shares. The pathway to creating a growing income stream is balancing higher yields and future dividend growth. ...</p>\n\n<a href=\"https://www.morningstar.com.au/insights/personal-finance/254146/top-8-asx-dividend-shares\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK7511","symbol_name":"ESG概念","start_time":0,"source_url":"https://www.morningstar.com.au/insights/personal-finance/254146/top-8-asx-dividend-shares","article_id":"2468873789","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2468873789","pubTimestamp":1726416000,"sourceInfo":{"source_id":"morningstar_stock","name":"Morning Star"},"weMediaInfo":null,"summary":"APA Group Moat rating: Narrow Forward yield: 7.6% Star rating:★★★★Morningstar’s Adrian Atkins sees APA Group as Australia's premier gas infrastructure company. Gas transmission and distribution is the core business, generating more than 80% of group earnings. Power generation—wind farms, solar farms and gas power stations","collect":0,"end_time":0,"defaultTopTitle":"morningstar.com.au","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK7511":"ESG概念","APA.AU":"APA GROUP","TLS.AU":"TELSTRA GROUP LTD","SPK":"SPK Acquisition Corp","BK4585":"ETF&股票定投概念","BK7124":"保健护理服务","EDV.AU":"Endeavour Group Ltd","DXS.AU":"Dexus","BK7140":"铁路","TLS":"Telos Corporation","REIT":"ALPS Active REIT ETF","REIT.AU":"VANECK FTSE INTERNATIONAL PR","BK7089":"人寿与健康保险","BK4588":"碎股","BK7122":"办公房地产投资信托","NHF.AU":"NIB HOLDINGS LTD","BK7148":"燃气公用事业","SPK.AU":"SPARK NEW ZEALAND LTD","EDV":"美国延期国债ETF-Vanguard","BK4097":"系统软件","SHL.AU":"SONIC HEALTHCARE LTD","APA":"阿帕契","XAO.AU":"标普/澳交所 普通股指数","AZJ.AU":"AURIZON HOLDINGS LTD","BK7042":"综合电信业务","BK7040":"食品零售","XJO.AU":"标普/澳交所 200指数","BK7510":"REITs概念","BK4213":"石油与天然气的勘探与生产","BK7154":"办公室房地产信托","XKO.AU":"标普/澳交所 300指数"},"translate_title":"澳大利亚证券交易所股息前8股","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"SPK.AU":1,"DXS.AU":1,"EDV":1,"EDV.AU":1,"NHF.AU":1,"REIT":1,"REIT.AU":1,"SHL.AU":1,"SPK":1,"TLS":1,"TLS.AU":1,"APA":1,"AZJ.AU":1,"APA.AU":1,"XKO.AU":0.9,"XAO.AU":0.9,"XJO.AU":0.9},"content_text":"Building passive income through dividend shares takes more looking for the highest yield shares. The pathway to creating a growing income stream is balancing higher yields and future dividend growth.  To find shares that may be attractive for income investors, we recently screened for ASX shares that, as of September 12th, met the following criteria according to our analysts:1. A forward dividend yield of at least 3.5%We choose 3.5% as it was the yield on 5-year Australian government bonds at the time of writing.The forward yield shown for each stock below is based on our analyst's FY25 dividend forecast. You may see a slightly different forward yield published elsewhere as I've used our analyst estimates. 2. Our analysts expect some dividend growthThe forward dividend yield is derived from our analyst’s expectations for FY25. As we are looking for companies with the potential to grow their payouts over time, we also filtered out companies that our analysts expect to cut or hold their dividend flat in FY 2026.3. A Wide or Narrow economic moat ratingThis seeks companies that our analysts think have a structural competitive advantage and can therefore earn excess returns on its investments for a long period. This could put these companies in a better position to maintain and grow their dividend over time.4. A Low or Medium Uncertainty ratingOur Uncertainty Rating represents the predictability of future business outcomes. The more predictable the outcomes the higher confidence our analysts have in their estimates of future dividends. Selecting low and medium uncertainty rated shares gives us more confidence in our view of future diviend growth.5. A Star Rating of four or fiveEven the most promising dividend payer can be a poor investment at the wrong price. A four or five star rating suggests that our analysts think the shares trade at an attractive level relative to how much they think the shares are worth. So those were the criteria for our screen – and this time, eight companies matched all five points. Here are some big names that didn’t make the cut.The big four banks missed out – none of them screen as undervalued, according to our analysts. None of the miners featured. The vast majority of miners were ruled out on Moat rating alone, while Narrow Moat IGO fell away thanks to its Uncertainty rating of High. Real estate titans like Charter Hall, Lendlease and Goodman missed out. Although one of their peers did make the list. There was no space for Macquarie Bank, Woodside or Wesfarmers – all of which feature prominently in many Aussie dividend funds.So, which ASX dividend shares made the cut?In alphabetical order, we have…APA Group (APA)Moat rating: Narrow Forward yield: 7.6% Star rating: ★★★★Morningstar’s Adrian Atkins sees APA Group as Australia's premier gas infrastructure company. Gas transmission and distribution is the core business, generating more than 80% of group earnings. Power generation—wind farms, solar farms and gas power stations—contribute about 11%, while electricity transmission, asset management and investments contribute the balance.APA Group's narrow economic moat stems from its unparalleled gas pipeline network, which benefits from efficient scale. Domestic gas markets are served by a handful of pipeline firms, of which APA is by far the largest. New entrants are deterred by high capital costs, while incremental demand growth can be met most cost-effectively by upgrading existing pipelines. APA Group generally pays out 60%-70% of free cash flow. This relatively conservative distribution policy is appropriate because the current level of free cash flow is not maintainable over the long term without massive investment in new projects.Atkins forecasts $0.57 per share in dividends from APA Group over fiscal 2025 and dividend growth just shy of 2% the following year. His forecast for FY25 represents a forward dividend yield of 7.6% at today’s price of around $7.50 per share. APA shares currently 20% discount to Atkins’ estimate of APA’s fair value.Aurizon (AZJ)Moat rating: Narrow Forward yield: 5.9% Star rating: ★★★★Aurizon operates the Central Queensland Coal Network (CQCN) railway under a lease agreement until 2109. As well as charging coal haulage firms for access to the CQCN, Aurizon also has its own haulage operations transporting coal and other bulk items. Aurizon’s Narrow Moat rating stems from its leasehold on the impossible to replicate CQCN.About half of Aurizon’s pre-tax earnings come from charging for access to the CQCN, while another third come from coal haulage. As a result, the outlook for Aurizon's business still depends most on how much metallurgical coal is produced and exported from Australia (and Queensland in particular). Meanwhile, the company’s main strategic focus is on growing its earnings from non-coal segments. Morningstar’s base case is that Australian met coal exports remain relatively flat over the medium term, even if demand from China and coal prices softens. This stems from the fact that Australia is a low-cost producer thanks to its high quality mines located nearby to ports.Our Aurizon analyst Adrian Atkins forecasts that Aurizon can pay dividend of around 20 cents per share in fiscal 2025. At a current share price of around $3.40, this represents a forward yield of almost 6%. Atkins thinks Aurizon can grow its payout by 7% in the following year. At $3.40, Aurizon shares trade at a 25% discount to Atkins’ Fair Value estimate of $4.50.Read more about Aurizon and its post earnings share price fall hereDexus (DXS)Moat rating: Narrow Forward yield: 4.9% Star rating: ★★★★★Dexus is a diversified Australian real estate investment trust (REIT). It generates income from charging rents, managing property for clients, investment services and property development. Rent from office and industrial properties accounts for the vast majority of income, and this is dominated by high-quality office buildings in Sydney. Morningstar has awarded Dexus a Narrow Moat based on the stickiness of funds in its investment management wing, the company’s smallest but fastest growing segment. Clients face switching costs here as withdrawals come with the prospect of notice periods, exit penalties and potential tax ramifications.Dexus’s trophy Sydney and Melbourne CBD offices also benefit from barriers to entry. While adding new supply isn’t impossible, new developments can take 5-10 years or longer to come to fruition due to hurdles including site acquisition, planning approvals and return requirements.Our Dexus analyst Jon Mills expects the company to pay a $0.37 per share dividend over fiscal 2025 for a forward dividend yield of 4.9%. He also thinks the company can grow its dividend by 7% in the following fiscal year. At a current price of $7.50 Dexus shares trade at a 30% discount to his estimate of Fair Value.Endeavour Group (EDV)Moat rating: Wide Forward yield: 4.3% Star rating: ★★★★Endeavour is Australia's leading omnichannel liquor retailer, operating the largest network of brick-and-mortar stores in the country across the well-known Dan Murphy's and BWS brands. Endeavour also has substantial interests in hotels and electronic gaming, operating more than 12,000 gaming machines across its portfolio of over 300 hotels, pubs, and clubs. Around 85% of Endeavour’s sales and 65% of its pre-tax earnings come from the liquor retailing segment.Endeavour controls 47% of Australia’s off-premise liquor market through its BWS and Dan Murphy’s brands, which have a combined 1,600 outlets throughout Australia. This makes Endeavour significantly larger than its closest integrated peer Coles Group (which has an estimated 17% of the market) and almost twice as big as Metcash’s base of customers.Endeavour’s dominant scale allows it to fractionalise distribution, administration, and marketing costs in a way that smaller competitors cannot. This has translated into Endeavour maintaining a materially higher level of operating margins than its peers for several years. Endeavour has also grown its liquor sales faster than Coles Group.Our Endeavour analyst Johannes Faul expects the company to pay out just shy of 22 cents per share in FY25 and for the dividend to grow nominally in FY26. At today’s price of around $5 per share, Endeavour has a forward yield of 4.3% and trades 18% below Faul’s Fair Value estimate. NIB Holdings (NHF)Moat rating: Narrow Forward yield: 4.9% Star rating: ★★★★NIB is Australia’s fourth largest provider of health insurance. Its existing 10% share of the market gives more bargaining power with healthcare service providers than smaller peers. As well as allowing NIB to keep up with most peers on price and policy features offered, this frees up funds for NIB to leverage its brand and advertising budget to attract customers directly.In addition to cost advantages, Zaia’s Narrow Moat rating for NIB is also underpinned by the presence of switching costs for existing policyholders. The wide range of choices in the market discourages consumers from switching due to the time required to compare different options. Meanwhile, waiting periods of up 12 months which must be served out before being able to claim for some extra services.Our NIB analyst Nathan Zaia thinks the company will pay $0.29 per share out in dividends during FY25 for a forward yield of 4.9%. He also expects NIB to grow its dividend by 3% in the following year. At a recent price of $5.80 per share NIB traded at a 21% discount to Zaia’s estimate of Fair Value.See why our analysts think that both NIB and Endeavour fell too far after earnings Sonic Healthcare (SHL)Moat rating: Narrow Forward yield: 4.0% Star rating: ★★★★Sonic is the leading private pathology operator in Australia, Germany, Switzerland, and the UK, which together contributed roughly 70% of pathology revenue in pre-pandemic fiscal 2019. In Australia, Sonic earned pathology revenue of AUD 1.5 billion in fiscal 2019 versus Healius’ AUD 1.1 billion, making it a third larger than its closest competitor.Our analyst Shane Ponraj awarded Sonic a Narrow Moat rating based on considerable cost advantages provided by scale in each of the pathology markets in which it operates. Scale matters in pathology labs, which operate a hub-and-spoke model whereby collection centers, either in hospitals or near doctors’ rooms, feed samples through to large centralized labs for processing.Ponraj thinks Sonic could pay out a dividend of $1.08 per share in its 2025 fiscal year for a forward yield of 4%. He expects the payout to grow in 2026, albeit by less than 1%. At a price of $26.84 the shares trade at a 17% discount to his estimate of Fair Value.Spark New Zealand (SPK)Moat rating: Narrow Forward yield: 8.2% Star rating: ★★★★Spark New Zealand has a strong position in the New Zealand telecoms industry and has the infrastructure to offer a diverse range of products. Spark generates over 40% of group revenue from the mobile telephony business, around 19% from fixed line broadband and the rest from IT products and services across several areas like cloud, data centres and managed data and networks. Spark's narrow moat rating is supported by cost advantage and economies of scale in a relatively small market. Spark is the equal-largest player in mobile with over 40% service revenue market share. The dominant market positions of Spark and Vodafone may make it difficult for new players to enter the market and establish necessary scale.Given the small New Zealand market, we believe there is a low risk that a new player will foot the cost of entering the market as an infrastructure network operator. Further, our Spark analyst Brian Han thinks that Vodafone’s private equity ownership may usher in a new era of more rational competition on pricing.Han thinks Spark can pay just above $0.25 per share out in dividends in fiscal 2025, representing a forward yield of over 8%. He also thinks the payout could grow by a whisker under 2% in fiscal 2026. At a recent price of $3.10 per share, Spark traded around 24% below Han’s Fair Value estimate.Telstra (TLS)Moat rating: Narrow Forward yield: 4.56% Star rating: ★★★★Telstra is a dominant player across every segment of Australia’s telecommunications space. Brian Han’s Narrow Moat rating stems mostly from scale-based cost advantages. Telstra can spread costs such as technology upgrades and marketing over a far larger customer base than competitors. Han also thinks Telstra benefits from aspects of efficient scale. By this he means that the relatively small, mature and low-growth nature of Australia’s telecoms market makes it less attractive for new entrants to spend billions of dollars replicating Telstra’s infrastructure assets.The outlook for Telstra’s earnings and dividend rely largely on two factors: continued growth in mobile and cost-control in its declining fixed line business. Han thinks Telstra could pay a dividend of $0.18 per share in fiscal 2025 for a forward yield of 4.5% and forecasts a 5% higher dividend in 2026. At a recent price of $3.96 per share, Telstra traded 12% below Han’s estimate of Fair Value.See Brian Han talk about Telstra's outlook hereMore articles on income investing: Is this the best metric for income investors?  4 income investing mistakes to avoid  A strategy to grow your passive income to $100,000 Dividend ETFs may disappoint income investorsGet more Morningstar insights in your inboxTerms used in this article Star Rating: Our one- to five-star ratings are guideposts to a broad audience and individuals must consider their own specific investment goals, risk tolerance, and several other factors. A five-star rating means our analysts think the current market price likely represents an excessively pessimistic outlook and that beyond fair risk-adjusted returns are likely over a long timeframe. A one-star rating means our analysts think the market is pricing in an excessively optimistic outlook, limiting upside potential and leaving the investor exposed to capital loss.Fair Value: Morningstar’s Fair Value estimate results from a detailed projection of a company's future cash flows, resulting from our analysts' independent primary research. Price To Fair Value measures the current market price against estimated Fair Value. If a company’s stock trades at $100 and our analysts believe it is worth $200, the price to fair value ratio would be 0.5. A Price to Fair Value over 1 suggests the share is overvalued.Moat Rating: An economic moat is a structural feature that allows a firm to sustain excess profits over a long period. Companies with a narrow moat are those we believe are more likely than not to sustain excess returns for at least a decade. For wide-moat companies, we have high confidence that excess returns will persist for 10 years and are likely to persist at least 20 years. To learn more about how to identify companies with an economic moat, read this article by Mark LaMonica.Uncertainty Rating: Morningstar’s Uncertainty Rating is designed to capture the range of potential outcomes for a company. An investor can think of this as the underlying risk of the business. For higher risk businesses with wider ranges of potential outcomes an investor should consider a larger margin of safety or difference between the estimate of what a share is worth and how much an investor pays. This rating is used to assign the margin of safety required before investing, which in turn explicitly drives our stock star rating system. The Uncertainty Rating is aimed at identifying the confidence we should have in assigning a fair value estimate for a stock. Read more about business risk and margin of safety here.","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.1","shortVersion":"4.29.1","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2468873789"}