While I am both a fan and a shareholder of Westpac Banking Corp (ASX: WBC), I feel that its shares are now fully valued after a solid rally over the last few months.
Because of this I would class them as a hold and suggest that investors either wait for a pull back or consider the two dividend shares listed below instead. They are:
G8 Education Ltd (ASX: GEM)
Although this childcare company's shares are trading within a whisker of their two-year high, I still believe they are a great option for income investors. Thanks to improvements in supply and occupancy levels, Ord Minnett recently slapped a buy rating and $5.10 price target on G8 Education's shares.
This would mean potential upside of over 12% from the last close price. Furthermore, G8 Education plans to pay a fully franked 20 cents per share dividend in FY 2018, which works out to be a fully franked 4.4% yield.
Japara Healthcare Ltd (ASX: JHC)
Due to Australia's ageing population and the projected increase in demand for aged care services, I believe Japara will be in a great position to profit. Especially as the company invests heavily to increase the number of beds under management.
While this investment is expected to cause earnings to be flat in FY 2018, earnings growth is forecast to accelerate again in FY 2019 when the new beds become available. At present Japara's shares provide a trailing 5.5% dividend.
