These ASX dividend shares could help you beat low rates

Here's why Sydney Airport Holdings Pty Ltd (ASX:SYD) and this ASX dividend share could help you beat low interest rates…

| More on:
A hand moves a building block from green arrow to red, indicating negative interest rates

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

With interest rates at rock bottom levels and unlikely to improve in the near term, the share market looks set to remain the best place to generate a passive income.

Listed below are two popular ASX dividend shares that could be worth a closer look. Here's what you need to know about them:

National Storage REIT (ASX: NSR)

The first ASX dividend share to look at is National Storage. It is one of the region's largest self-storage providers. From its 200+ centres across Australia and New Zealand, the company tailors self-storage solutions to residential and commercial customers.

National Storage has been growing at a solid rate over the last decade thanks to a combination of organic and inorganic growth. This continued during the first half of FY 2021 when the company reported underlying earnings growth of 14% to $39.2 million.

This allowed the company to increase its FY 2021 earnings guidance to 8.1 cents to 8.5 cents per share, with 90% to 100% of this being paid out as distributions.

Based on this guidance and the current National Storage share price, this will mean a ~3.9% dividend yield in FY 2021.

Sydney Airport Holdings Pty Ltd (ASX: SYD)

The second ASX dividend share to look at is Sydney Airport. Although the airport operator is having a tough time because of the pandemic, traffic numbers continue to improve. And with vaccines rolling out across Australia and the globe, this trend looks set to continue.

One leading broker that believes it is worth being patient with Sydney Airport is Goldman Sachs. It currently has a buy rating and $6.73 price target on its shares.

In addition to this, the broker is forecasting a meaningful recovery in dividends in the near future. Goldman estimates that the company will pay 8.8 cents per share in FY 2021 and then 27.1 cents per share in FY 2022.

Based on the current Sydney Airport share price of $5.77, this will mean yields of 1.5% and 4.7%, respectively.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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

Different Australian dollar notes in the palm of two hands, symbolising dividends.
Dividend Investing

This 5% monthly dividend stock is a cash flow machine

If you want monthly passive income, check out this stock.

Read more »

A woman presenting company news to investors looks back at the camera and smiles.
Dividend Investing

Broker names the best ASX dividend shares to buy now

Let's see why the broker is feeling bullish about these income options.

Read more »

A cute little kid in a suit pulls a shocked face as he talks on his smartphone.
Dividend Investing

Up 38% in a year, is it too late to buy Telstra shares for the dividends?

A leading expert gives his verdict on Telstra’s passive income appeal following the stock's 38% 12-month share price gains.

Read more »

A young woman dressed in street clothes leaps happily in the air with the focus on her bright red boots that are front and centre for the camera.
Dividend Investing

This ASX dividend share is projected to pay a 10% yield by 2028

Analysts are expecting big payouts from this business.

Read more »

A couple sits in their lounge room with a large piggy bank on the coffee table. They smile while the male partner feeds some money into the slot while the female partner looks on with an iPad style device in her hands as though they are budgeting.
Dividend Investing

Want to turn $20K into a $1K second income? Here's how

ASX shares can pay you upfront for buying them...

Read more »

A man and woman sit next to each other looking at each other and feeling excited and surprised after reading good news about their shares on a laptop.
Dividend Investing

2 ASX dividend shares I think are great value today

These two stocks offer a lot of what I’m looking for.

Read more »

Excited couple celebrating success while looking at smartphone.
Dividend Investing

Buy Woodside and these ASX dividend stocks

Brokers have put buy ratings on these dividend payers.

Read more »

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

Macquarie share price higher amid DRP dividend news

Macquarie has announced the share price of stock to be allocated through its dividend reinvestment plan.

Read more »