Top ASX dividend shares are in high demand from income investors.
Dividends can be a great way to fund your desired lifestyle. Cash in the bank just isn't cutting it any more.
Here are four great ideas to boost your income:
Service Stream Limited (ASX: SSM)
Service Stream provides integrated, end-to-end asset life-cycle services across essential infrastructure networks with in the telecommunications and utilities sectors. It's involved in design, construction, maintenance and operations.
It recently reported its FY20 half-year result which showed all profitability measures rose compared to last year, with adjusted earnings per share (EPS) up 14%. It is winning new contracts and has a pipeline of development opportunities. It's also looking at external growth and diversification opportunities.
Service Stream also grew its interim dividend by 14% to 4 cents per share. That brings the trailing grossed-up dividend yield to 5.8% due to the share price fall after the report.
Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
I think Soul Patts is the gold standard for dividends on the ASX. Why? It has grown its dividend every year since 2000, it has paid a dividend every year in its 117-year history and it currently has a forward grossed-up dividend yield of 4.1%.
It's an investment conglomerate, so it can alter its holdings as it sees fit for long-term growth. This means the company's value should be able to keep growing for decades to come and you won't have to worry about selling.
Soul Patts has a high level of ownership from management as well as by diversified property business Brickworks Limited (ASX: BKW), meaning Soul Patts isn't likely to take excessive risks.
Its total returns have outperformed the ASX over the long-term and I think that could continue.
Future Generation Investment Company Ltd (ASX: FGX)
Future Generation is a listed investment company (LIC), as the name might suggest. It currently offers a grossed-up dividend yield of 6% and it has increased its dividend each year since it started paying in 2015.
The LIC is currently trading at a 10.5% discount to the underlying value of Future Generation at 31 December 2019. I think it's nearly always attractive to buy shares of a business which is trading cheaply compared to the value of its quality assets.
What are Future Generation's assets? It is invested in the funds of ASX-focused fund managers, but those 20-ish fund managers work for Future Generation for free so that it can donate 1% of its net assets each year to youth-related charities.
I think everyone is a winner from Future Generation.
Duxton Water Ltd (ASX: D2O)
Duxton Water is a very interesting business. It purely owns water entitlements and leases them out to agricultural businesses.
Water values continue to rise because of the long-term lack of rainfall and the higher demand from high-value, water-hungry crops like almonds.
Duxton Water is entering into more long-term leases which secures income at attractive prices for the company, which has allowed the Board to forecast continued growing dividends over the next year.
The forward grossed-up dividend yield is now 5.6% because it's trading at such a large discount to the underlying value of the water assets it owns.
Foolish takeaway
All four shares are good dividend ideas. Soul Patts could get a boost as early as this week if a court decision goes TPG Telecom Ltd's (ASX: TPM) way, it's also a great long-term pick. However, Service Stream could be quite opportunistic to buy whilst Future Generation is at a good discount to its net assets.
