Macquarie Group Ltd (ASX: MQG) shares, Dicker Data Ltd (ASX: DDR) shares and National Australia Bank Ltd. (ASX: NAB) shares offer dividends to trump term deposits.
Indeed, at a time when term deposits and savings accounts are paying just 2.5% pre-tax, it's easy to see why Australian investors are flocking to dividend-paying shares.
Macquarie
Macquarie Group is Australia's largest investment bank, with its operations stretching across the globe. During the Global Financial Crisis of 2008/2009, the Macquarie share price crashed from over $97 in mid-2007 to just $17 by early 2009. Since then, the bank has taken strides to focus its operations on 'annuity-style' business. Meaning, it has lessened its reliance on financial markets directly.
Shares in the $31 billion bank are expected to pay dividends of $4.30 in the year ahead, which equates to a dividend yield of around 4.7% with partial franking.
Dicker Data
Dicker Data is a much smaller company, with a market capitalisation of around $370 million. The company is a distributor of IT products throughout Australia. In addition to being a smaller, less liquid, company, Dicker Data has a chunk of debt on its balance sheet and earns only slim profit margins on its products.
However, it is founder-run and offers a decent dividend yield at today's prices. With the company recently forecasting fully franked dividends of four cents per share per quarter, Dicker Data shares yield 6.9%.
National Australia Bank
NAB is Australia's third-largest bank, with a focus on business banking. It controls more than 21% of Australia's business banking needs, with 14.6% of household lending. Like its peers, NAB shares stand to benefit from increasing interest rates. Last month, NAB upped its interest rates on mortgages to investors and owner occupiers as a result of increases in the cost of funding.
So long as the housing market continues to show strength and the economy keeps ticking over, investors will be drawn to NAB's impressive 5.8% dividend yield.
Foolish Takeaway
If you are looking to add dividend-paying Australian shares on your watchlist, I think these three companies deserve a spot. At today's prices, I think Macquarie is worthy of further research for investors who can stomach times of potential volatility but keep holding for the long-term.
