With the outlook for interest rates in Australia incredibly bleak, I suspect that dividend shares will remain the best way to earn a passive income for some time to come.
But which ASX dividend shares should you buy today? I think these are the ones to snap up right now:
Dicker Data Ltd (ASX: DDR)
I think Dicker Data is a great option for income investors. It is a leading wholesale distributor of computer hardware and software. Despite the pandemic, Dicker Data has been a very positive performer in FY 2020 and recently released a strong half year result. During the six months, the company delivered an 18.1% increase in revenue to $1,006.1 million and a 23.6% jump in net profit after tax to $29.4 million.
Given its strong market position and favourable industry tailwinds, I believe it is well-placed to continue its growth over the coming years. For now, the company is expecting to pay a 35.5 cents per share dividend for the full year. Based on the current Dicker Data share price, it offers a fully franked forward 4.8% dividend yield.
National Storage REIT (ASX: NSR)
Another option I would suggest investors consider buying is this self-storage operator. I believe it could be a great long term option due to its strong position in a fragmented market and its growth through acquisition strategy. As with Dicker Data, National Storage was a positive performer in FY 2020 despite the pandemic. It delivered a 9% increase in underlying earnings to $67.7 million over the 12 months.
Looking ahead, FY 2021 is expected to be tougher and management has warned that its earnings could be flat. However, this is a lot better than what many other companies will achieve in FY 2021 and still implies a very attractive yield. It expects to deliver earnings of 7.7 cents to 8.3 cents per share. After which, it will pay out 90% to 100% of this to its shareholders. The middle of this range (8 cents earnings per share and a 95% payout ratio) would be a 7.6 cents per share distribution. Based on the current National Storage share price, this represents a generous 4.1% yield.
