With the RBA expected to decrease the Australian interest rate because of Australia’s rising unemployment rate, it could be a good time to find ASX dividend shares.
Having a watchlist is a good idea so that you know what shares you would buy if you did have some money to invest, such as $5,000.
These are three ASX shares on my dividend watchlist:
Urb Investments Ltd (ASX: URB)
Urb is a listed investment company (LIC) which focuses on the urban renewal thematic. Due to the current negativity about Australian house prices, Urb is now trading at a 17% discount to the net tangible assets (NTA) at the end of April 2019.
However, with cash making up 35% of the Urb portfolio and listed ASX shares (including large holdings of Transurban Group (ASX: TCL) and Sydney Airport Holdings Ptly Ltd (ASX: SYD)) being almost half of the value of the portfolio, I think the large discount looks attractive.
Urb aims to sustainably grow its dividend and has a grossed up dividend yield of around 4.3% according to the company.
WAM Microcap Limited (ASX: WMI)
WAM Microcap is another LIC, it invests in ASX shares with market capitalisations under $300 million. This end of the market is the riskiest but can also provide the largest returns over the long term.
Since inception, WAM Microcap’s portfolio has created performance of 18.5% per annum before expenses, fees and taxes. I’m not expecting the same every year, but the small cap hunting ground could keep being fertile.
Including franking credits, WAM Microcap has a dividend yield of 5.3%.
Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
WHSP has been operating since 1903 and has paid a dividend every year in that time. I really like that it has grown its ordinary dividend each year since 2000.
It offers concentrated diversification with large positions in TPG Telecom Ltd (ASX: TPM), New Hope Corporation Limited (ASX: NHC) and Brickworks Limited (ASX: BKW).
With no debt and a large profit reserve, I think WHSP looks like a solidly conservative dividend share. Including the franking credits, it has a dividend yield of 3.5%.
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Disclosure: Jaz owns shares of Washington H. Soul Pattinson and Co. and WAM Microcap at the time of writing, but this could change at any time.
