Expert reveals the dividend ASX share he just bought (and one he dropped)

With the market in considerable turbulence, ASX shares that pay out dividends seem to be back in favour.

They were out of fashion for much of the pandemic as businesses tightened their belts to preserve capital.

But now investors are looking to ASX shares with chunky yields as a buffer from tough market and economic conditions.

"We liken an attractive yield to being 'paid to play' while we wait for market conditions to improve," Celeste Funds executive chair Paul Biddle told the Australian Financial Review.

"That's not a bad outcome if the sharemarket is flat this year."

Keeping this in mind, another prominent fund manager this week revealed which dividend stock he has picked up in recent times — and another that he has cut loose:

'Very attractive dividend yield'

Blackmore Capital chief investment officer Marcus Bogdan said that his fund recently bought shares in Atlas Arteria Group (ASX: ALX).

"We're allocating capital to Atlas Arteria, which is a toll road operator in both Europe and the US," he told Switzer TV Investing.

"It provides a very attractive dividend yield for our investors."

Indeed, Atlas Arteria shares are handing out a dividend yield of 5.16% while its stock price holds steady this year.

The analyst community generally agrees with Bogdan.

According to CMC Markets, six out of 11 analysts rate the stock as a strong buy, with another labelling it as a moderate buy.

Last month, Atlas Funds Management chief investment officer Hugh Dive told The Motley Fool that his fund had also been "buying a lot" of Atlas Arteria stocks. 

"That bounced back much faster than we expected when the lockdowns were opened in France," he said.

"Has extremely low cost of debt. Great set of assets. Dividends are growing quite strongly."

The dividend share that's reached 'peak earnings'

Meanwhile, Bogdan's team recently sold off their interest in another dividend share, Healius Ltd (ASX: HLS).

"Healius was a terrific stock we held through the pandemic," said Bogdan.

"It was one of the few healthcare stocks [we held] because they're a pathology company that benefited from PCR testing."

The huge volume of COVID-19 testing saw a "100% uplift in profits" for Healius. But the Blackmore team feels like that pot of honey is running out.

"The company is reaching, sort of, peak earnings," he said.

"So we're taking advantage of the higher price that we've enjoyed."

Bogdan's team then reallocated the proceeds from that sale onto Atlas Arteria.

"By taking some profits out of Healius and putting it into Atlas, we're actually increasing the overall dividend yield of the portfolio."