September 2021 looks like a good month to buy some ASX dividend shares for an income-focused portfolio.
It’s difficult to generate a good yield these days because central banks have pushed interest rates so low.
But there are still some ASX dividend shares that could be solid picks for the long-term:
Brickworks Limited (ASX: BKW)
Brickworks is a leading Australian (and now American) brickmaking business.
It has a leading position in Australia as well as plenty of states in the north-east side of the US after some acquisitions. It also recently acquired the largest US independent brick distributor.
The business also has other building products in Australia including masonry, roofing, precast and so on.
Whilst it’s capable of producing solid profit from building products, it’s the other parts of the business that provide the cashflow and value for Brickworks to be a great ASX dividend share.
It owns a large chunk of Washington H. Soul Pattinson and Co Ltd (ASX: SOL) shares. WHSP is a diversified investment house with defensive assets and has the longest dividend growth record on the ASX, going back to 2000. Its biggest investment is TPG Telecom Ltd (ASX: TPG).
The other part to Brickworks is the industrial property trust that it owns half of along with Goodman Group (ASX: GMG). This trust is benefiting from organic rental increases, valuation gains and new projects being finished.
When two huge warehouses have been completed for Coles Group Ltd (ASX: COL) and Amazon, it’s expected to lead to a substantial increase of rental profit and gross asset valuation increase.
At the current Brickworks share price, it has a fully franked dividend yield of 2.5%. Brickworks hasn’t cut its dividend in over four decades.
MFF Capital Investments Ltd (ASX: MFF)
I believe that MFF Capital could be one of the best ASX dividend shares to consider.
The board has committed to steadily grow its half-yearly dividend from $0.01 per share in 2017 to $0.05 per share over the next year or two. That’s probably not going to be the end of dividend increases either.
When the annual dividend reaches $0.10 per share, that will equate to a fully franked dividend yield of 3.3% at the current MFF Capital share price.
Total returns are the most important thing in my opinion, but a fast-growing dividend is a very nice feature.
That dividend is being funded by investment gains made by a high quality portfolio of international shares. Visa and Mastercard dominate the portfolio, making up just under a third of the total value. Amazon, Home Depot, Facebook and Alphabet are also sizeable positions.
One of the main reasons I like listed investment companies (LICs), aside from the typical higher dividend yield, is that they can adjust their portfolios. Some LICs like MFF Capital can invest any assets anywhere in the world, giving it great flexibility and diversification.
I also think that MFF Capital is at great value. The latest MFF Capital share price is $2.99 compared to the underlying value (net tangible assets – NTA) of $3.445. That’s an attractive discount of 13.2%.
