With the coronavirus spike in Victoria threatening to derail Australia's economic recovery, the near-term payments of a number of popular dividend shares could be impacted.
In light of this, if you're looking to buy dividend shares right now, I think the safe and strong ASX dividend shares listed below could be the ones to buy.
Here's why I would buy them for income:
Coles Group Ltd (ASX: COL)
I think Coles would be a great ASX dividend share to buy. It appears well-positioned to continue its growth in FY 2020 and FY 2021 despite what happens in the wider economy. This is thanks to its defensive qualities and strong market position. Looking further ahead, I believe its long term outlook is very positive due to its refreshed strategy and focus on automation. Combined with its long track record of achieving same store sales growth, I expect this to lead to solid earnings and dividend growth throughout the 2020s. Based on the latest Coles share price, I estimate that it provides investors with a fully franked 3.7% FY 2021 dividend yield.
Rural Funds Group (ASX: RFF)
Another ASX dividend share to consider buying is Rural Funds. Due to the quality of its assets and their ultra-long tenancy agreements, I believe this agriculture-focused property group is well-positioned to continue growing its distribution during the pandemic and beyond. In fact, Rural Funds recently reaffirmed its distribution guidance of 10.85 cents per share in FY 2020 and then 11.28 cents per share in FY 2021. This equates to yields of 5.4% and 5.65%, respectively.
Telstra Corporation Ltd (ASX: TLS)
A final ASX dividend share to consider buying is Telstra. I think the telco giant is a great option for investors due to its defensive qualities and generous dividend yield. At the height of the pandemic, Telstra reaffirmed its guidance for FY 2020. This includes its free cash flow guidance, which is of course important for dividend payments. Based on this guidance, I believe its current dividend is sustainable and will be paid as normal this year. And with the Telstra share price currently changing hands at $3.47, this equates to an attractive fully franked 4.6% dividend yield.
