TLC News: Exploring ASX Dividend Stocks: Avoiding Lottery And Highlighting One Superior Option - 3rd Jul 2024, 5:06am

[annb0t]

In the pursuit of reliable dividend income from ASX-listed companies, investors should be cautious about high payout ratios. While a generous dividend can be appealing, it's essential to verify if these payouts are supported by the company's earnings. A high payout ratio may indicate that dividends are not sustainable over time, potentially leading to financial difficulties for the company, as seen with some firms like Lottery.

Top 10 Dividend Stocks In Australia

Name Dividend Yield Dividend R...

>>> Read more: Exploring ASX Dividend Stocks: Avoiding Lottery And Highlighting One Superior Option

 

[Taipan]

Most of those stocks are rubbish when it comes to yields with the exception of FMG. Most of the decent yields will never appear in those lists for various reasons as the bigger houses that come out with these lists never look at companies outside of a certain set.
You are correct that payout ratio's are to be scrutinised. When a company is paying out 135% of their NPAT as a dividend, you can probably safely assume its not going to be sustainable. Payout ratio's are only one component and not the first i look at.
Forward earning, yield, earnings growth, balance sheet, payout ratio, div stability and others should all be looked at if you're looking for a good long term dividend stock.

There are stocks out there that deliver over 10% per annum yields with modest cap growth but you need to DYOR.