The best ASX dividend shares for income are the only ones I'd trust to fund my life's expenses.
I just don't think that shares like Westpac Banking Corp (ASX: WBC) and Sydney Airport Holdings Pty Ltd (ASX: SYD) are going to cut it over the medium-term, particularly due to the coronavirus.
Here are three of the best ASX dividend shares for income in my opinion:
WAM Research Limited (ASX: WAX)
I think, WAM Research is one of the best listed investment companies (LICs) that focuses on ASX shares. It's run by Wilson Asset Management (WAM) and it targets small and medium undervalued companies where there's a potential catalyst to boost the value of the company.
Over the past decade it has generated some of the best LIC gross investment returns. WAM Research has managed to do this whilst holding onto high levels of cash. It holds dozens of shares, so it has a diverse portfolio.
It has increased its dividend every year since the GFC and it still has an attractively large profit reserve so it can keep paying dividends. WAM Research currently has an annualised grossed-up dividend yield of 11.1%.
APA Group (ASX: APA)
APA is one of the best ASX dividend shares in terms of how many years it has consecutively grown its income to shareholders. The distribution has grown every year for over a decade and a half, including through the GFC.
It owns a vast network of 15,000km of natural gas pipelines around Australia with a presence in every mainland state and the Northern Territory. It also owns or has interests in gas storage facilities, gas-fired power stations and renewable energy generation (wind and solar farms). APA owns, or manages and operates, a portfolio of assets worth more than $21 billion and delivers half the nation's natural gas usage.
I'm excited by the prospect of the company looking at US opportunities. America is a large market there and earnings diversification would make the company an even safer income bet.
Using the 50 cents per unit distribution guidance, it currently offers a distribution yield of 4.3%.
Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
I think Soul Patts could be the best ASX dividend share. It has grown its dividend every year since 2000 and has paid a dividend every year in its existence, which stretches back over a century.
The investment house funds its annual dividend just from the investment income it receives, less operating costs. The retained cash profit is re-invested into more long-term opportunities.
I believe some of its largest positions still have exciting medium-term growth prospects. The TPG Telecom Ltd (ASX: TPM) merger with Vodafone Australia is exciting for all of the potential synergies and bigger dividends. Brickworks Limited (ASX: BKW) has a promising long-term future in the US from productivity improvements alone.
Soul Patts currently has a grossed-up dividend yield of 4.7%.
Is it time to buy the best ASX dividend shares?
If income is your only concern then I think all three could be a buy today. However, APA's share price has recovered strongly and WAM Research is probably trading at an expensive premium. Soul Patts would be my preferred pick today for dividends and growth.
