With an average dividend yield of approximately 4.1%, I think the Australian share market is a great place for those in search of a source of income.
Three top dividend shares that I would buy this month are listed below. Here's why I like them:
Adairs Ltd (ASX: ADH)
I think that this home furnishings retailer is one of the best options in the retail sector right now. Adairs was an impressive performer in FY 2018 and delivered a 45.4% increase in profits to $30.6 million thanks partly to strong like for like sales growth. Pleasingly, momentum has carried over into FY 2019, putting it in a great position to outperform once again. If this does happen then I believe there's a strong chance it could lead to its shares rerating to a more appropriate and higher earnings multiple. At present Adairs' shares offer a trailing fully franked 5.8% yield.
Australia and New Zealand Banking Group (ASX: ANZ)
On Thursday this banking giant lifted its variable mortgage rates in an effort to offset increasing funding costs. I believe this was a smart move and will put the bank in a stronger financial position. And with the majority of its peers also following suit, I don't expect it to have any impact on competition. All in all, I believe ANZ Bank could be a good option for income investors over the coming years. Its shares currently provide a trailing fully franked 5.6% dividend.
National Storage REIT (ASX: NSR)
Another top option for income investors could be this real estate investment trust which has a focus on self-storage assets. Last month the storage company posted a 12.5% increase in underlying earnings to $51.4 million. The company's strong performance in FY 2018 allowed the board to lift its distribution to 9.6 cents per unit, which equates to a trailing yield of 5.7% based on its last close price. Thanks to the market being highly fragmented and demand being strong, I believe the company has solid long-term growth prospects and its dividend could grow at a decent rate over the coming years.
