2 ASX dividend shares with attractive yields to buy this week

Coles Group Ltd (ASX: COL) is one of the 2 ASX dividend shares boasting attractive, fully franked yields on recent pricing.

| More on:
Happy young man and woman throwing dividend cash into air in front of orange background.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

A major component of choosing an ASX dividend share is, naturally, the yield that that ASX dividend share has on offer. As long as a company can pay a reasonable and stable dividend each year, the onus on delivering capital growth can be eased. This is especially true for investors who only invest for dividend income.

So here are 2 ASX dividend shares that are offering attractive yields on recent pricing, as well as full franking credits.

2 ASX dividend shares with attractive yields this week

Coles Group Ltd (ASX: COL)

Coles is one of the most well-known companies in the country. It's Australia's second-largest grocery chain and also owns some other ventures, such as bottle shop chains.

Coles shares have been out of favour ever since the company reported its earnings for the first half of FY2021 last month. And that was despite the company reporting an 8% increase in revenue and a 10% jump for its interim dividend.

In fact, Coles shares are now down around 15% year to date. But, as ASX dividend investor would know, lower share prices mean higher starting dividend yields. And the most recent pricing of Coles indicated a dividend yield of 3.88% (or 5.54% grossed-up with full franking) on offer.

That's a heck of a lot more than what you could expect from a term deposit these days and handily outstrips inflation as well. Since Coles sells groceries and other life essentials, its earnings base is relatively durable as well (as the company proved last year). That is a great advantage to have in a dividend share and is one of the reasons Coles was able to grow its dividends during the worst of the coronavirus pandemic in 2020.

Telstra Corporation Ltd (ASX: TLS)

Telstra is another ASX dividend share to consider today. As the ASX's largest telco, Telstra has long had a reputation for large dividend yields, despite the infamous 'day of the long dividend knives' in 2017 (when Telstra slashed its dividends from the historic high of 31 cents a share).

These days, Telstra pays an annual dividend of 16 cents per share (including 6 cents in special dividends), which the company recently re-affirmed for 2021. Even so, this annual payout equates to a yield of roughly 5.2% on recent pricing, or 7.41% grossed-up with full franking.

As with Coles, that kind of yield runs rings around term deposits despite interest rates and other cash-based investments. It also puts Telstra in the upper echelons of yields offered by many of the ASX's blue-chip shares, like the big four banks.

Since Telstra sells highly inelastic products and services like phones, broadband and mobile data (all modern essentials), it also has a very inelastic earnings base as well.

Motley Fool contributor Sebastian Bowen owns shares of Telstra Limited. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia owns shares of COLESGROUP DEF SET. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Dividend Investing

A woman sits at her computer with her chin resting on her hand as she contemplates her next potential investment.
Dividend Investing

Hunting for passive income? Here's everything you need to know about the latest NAB dividend

NAB revealed its interim dividend payout this morning.

Read more »

A couple makes silly chip moustache faces and take a selfie on their phone.
Dividend Investing

I think these 2 high-yield ASX dividend shares are buys in May

These businesses offer significant passive income.

Read more »

Wife and husband with a laptop on a sofa over the moon at good news.
Dividend Investing

2 ASX dividend stocks to buy for juicy 5% to 8% yields

These shares are being named as buys for income investors by brokers.

Read more »

Man pointing an upward line on a bar graph symbolising a rising share price.
Dividend Investing

3 growing ASX dividend shares to buy and hold

Analysts are feeling positive about these shares. Let's see what they are forecasting for them.

Read more »

Joyful woman at a beach on the Gold Coast with her arms spread out.
How to invest

How to bank $10,000 a year in passive income from these 3 top ASX shares

Here’s how I’d go about building a $10,000 passive income stream from these top ASX stocks.

Read more »

A woman relaxes on a yellow couch with a book and cuppa, and looks pensively away as she contemplates the joy of earning passive income.
ETFs

3 ASX ETFs to buy for passive income in May

Don't like stock picking but want passive income? Here are three funds that could help you.

Read more »

A businesswoman on the phone is shocked as she looks at her watch, she's running out of time.
Bank Shares

Want to bag the next Westpac shares dividend? Better be quick…

Westpac will pay an interim dividend of 76 cents per share next month.

Read more »

supermarket asx shares represented by shopping trolley in supermarket aisle
Dividend Investing

Should I buy Coles shares for their reliable passive income?

We take a look at Coles’ passive income credentials and the potential for share price gains.

Read more »