This expert believes S&P/ASX 200 Index (ASX: XJO) companies will be reining in their dividend payouts next year, but those belonging to one sector might not.
Tribeca Investment Partners portfolio manager Jun Bei Liu thinks ASX 200 retailers will be boasting strong cash balances in 2022, leading to larger than average dividend returns.
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Will 2022's dividends to lag 2021's?
Liu's prediction comes after the total dividends paid by ASX shares in financial year 2021 were found to have increased 126% on a headline basis to $41.9 billion.
As my Foolish colleague Mitchell reported, the dividend surge was supported by strong returns from ASX 200 banks and miners.
But that might be about to change. Here's why Liu believes that those who hold retail shares might be receiving impressive dividends in 2022.
ASX 200 retailers might lead 2022 dividends
Liu told The Age that she is looking to retailers to lead the dividend push in 2022 as they bank their cash from the pandemic. The publication quoted Liu as saying:
So far, we haven't seen significant cash return from retailers – we've seen some – but there will be more… We think by February-March, you should start seeing retailers talking about it, and by August next year we'll see pretty strong dividend returns.
However, she believes geopolitical tensions might weaken payouts. Such tensions might harm already rocky supply chain disruptions, increasing volatility, Liu commented:
The minute the market becomes more volatile, corporations will try to hold on to cash. They won't pay it out.
It's only prudent. So, this is something that will weigh on corporates' intention of paying out dividends.
ASX 200 retail shares with strong dividend yields include:
- Adairs Ltd (ASX: ADH). According to Commsec, the home furnishings retailer has a dividend yield of 6.1%.
- JB Hi-Fi Limited (ASX: JBH), which Commsec states has a dividend yield of 5.3%.
- Harvey Norman Holdings Limited (ASX: HVN). Commsec lists the furniture retailers dividend yield at 6.4%.
