The Woolworths Group Ltd (ASX: WOW) share price is likely to trade lower this morning regardless of what happens on Wall Street.
This is because the retail giant's shares are due to trade ex-dividend today for its interim dividend of 46 cents per share. When this happens, a share will tend to drop to reflect the fact that they are trading without the rights to the upcoming dividend.
Eligible shareholders can now look forward to receiving Woolworths' dividend in their nominated accounts in just over a month on April 9.
But what should you do with it when you receive it? If you plan to invest these dividends back into the market, here's where I would invest the funds:
Altium Limited (ASX: ALU)
I think a sharp pullback in the Altium share price in recent weeks is a buying opportunity for investors. Although its first half update was a touch underwhelming, management remains confident in its medium term plans. Altium is aiming for US$500 million of revenue with 100,000 Altium Designer subscribers in FY 2025. I believe Altium will deliver on its targets thanks to quality of its offering and the Internet of Things boom which is driving strong demand for design software.
Telstra Corporation Ltd (ASX: TLS)
If you have a preference for blue chips then I think it could be worth considering Telstra. I like Telstra due to its improving outlook, attractive valuation, and generous yield. In respect to the latter, I believe the company's cash flows will be able to sustain a 16 cents per share fully franked dividend for the foreseeable future. Especially given the success of its T22 strategy and the return of rational competition. Based on this, its shares provide a fully franked 4.6% dividend yield.
Xero Limited (ASX: XRO)
Another growth share to consider investing the funds into is Xero. It is one of the world's leading cloud-based business and accounting software providers. Xero has been growing at a very strong rate over the last few years thanks to the growing popularity of its software with small businesses. And while it may have recently surpassed two million subscribers, this is still only scratching at the surface of its massive market opportunity. I expect further market share gains in the coming years, driving strong recurring revenue growth.
