Looking for the best ASX shares to boost the value of your portfolio? Choosing ASX shares with both long-term growth prospects and reliable high-yield dividends is a foolproof way to build income and set-up your retirement early.
Here are 2 top ASX shares I would buy right now for shareholder value and dividend growth.
Image source: Getty Images
Dicker Data Ltd (ASX: DDR)
Dicker Data is an Australian wholesale and distributor of computer hardware, software and related products. Its vendors include Hewett-Packard, Cisco, Toshiba, Lenovo, Microsoft, ASUS and other major brands. Dicker Data services 5,000 retailers who in turn service multiple clients ranging from small and medium enterprises to large corporate businesses.
Dicker Data's half year 2020 group results in July didn't disappoint. Total revenue was up 18.1% to $1,005.9 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) grew 27.6% to $47 million. And net profit after tax rose 23.5% to $29.4 million.
Pleasingly for shareholders, the company's dividend growth was a massive 63.4% increase for FY19 compared to 20.2 cents per share (cps) for FY18. In total, the company paid out 33 cents to shareholders in the last 12 months. It plans to further increase its dividend to 35.5 cps this year.
Dicker Data has achieved double-digit revenue and profit growth for the past 5 years to become Australia's largest commercial distributor and leading market share distributor for most of its tier 1 vendors represented.
To maintain growth and preserve the company's strong balance sheet, Dicker Data has reduced its reliance on its top 5 vendors from 90% in FY12 to 57% in FY19.
I like Dicker Data because it pays quarterly dividends to shareholders and the business has been maturing consistently for a number of years. Dicker Data has shown to be resilient in challenging conditions such as COVID-19 and is well-positioned for future growth
At the time of writing, the Dicker Data share price is down 2.97%, trading at $7.51. Still, I think Dicker Data offers investors a worthy buy.
Fortescue Metals Group Limited (ASX: FMG)
As the world's fourth largest iron ore producer, Fortescue has become a very important trade partner to China and other countries with a strong demand for the steel-making ingredient.
Fortescue's FY20 results released on Monday highlighted total revenue of $12.82 billion, an increase of 28.6% on FY19. Underlying EBITDA was also up 38.4% to $8.375 billion, and net profit after tax climbed to $4.735 billion, a strong percentage boost of 48.5%.
The pure-play miner also boasts the industry's leading cost position on extracting and refining its key product, at C1 costs at US$12.94 per wet metric tonne. Record shipments were exported of 178.2 million tonnes in the past year.
It's no wonder the Fortescue share price has exploded over the past 5 years from $1.62 to a whopping $18.64 (at the time of writing). Of course, a major catalyst for the company's strong balance sheet is the rising spot price of iron ore which has a knock-on effect with the share price.
The company has a dividend yield of 10.59%, as shareholders have recently been rewarded with $1 for every Fortescue share held. For FY20, the mining magnet's total dividend remuneration was $1.76. For those lucky early investors who bought and kept Fortescue shares back in 2015, they would have a 108% payout on their initial investment in just one year. That is the power of long-term investing.
I think Fortescue is a great ASX share to add on your portfolio. The company offers shareholder value with strong growth in both its business and dividends.
