Though just high dividend yield might be deceptive to naïve investors, growing Dividend Stocks with potential for growth reflect a better picture. The perspective for such stocks is that besides offering passive income these stocks may also return capital appreciation to the investors.
Three such Stocks on ASX are
Scentre Group (ASX: SCG)
Scentre Group, a major player in the Australian retail property sector, owns and manages 42 Westfield destinations across Australia and New Zealand, encompassing about 12,000 outlets.
The portfolio's broad reach and consistently high customer visitation rates underscore its leadership in the industry. With a substantial land portfolio in prime locations and a robust $4.0 billion pipeline of upcoming development projects, Scentre Group is poised for sustained long-term growth and value creation.
The Group maintains strong liquidity and employs effective interest rate hedging strategies to ensure financial stability, facilitating ongoing investment in growth opportunities. Sound financial management and strategic hedging practices mitigate risks and enhance shareholder returns. Proactive activation programs, including partnerships with leading brands like Disney and Live Nation, drive increased customer engagement and foot traffic, while the expansion of the Westfield membership program enhances customer loyalty and operational resilience.
During the three months ended 31 March 2024, Scentre’s business partners achieved $6.5 billion in sales, marking a 2.4% increase compared to the same period in 2023. On a rolling 12-month basis to 31 March 2024, sales reached $28.5 billion, which is $1.0 billion more than the corresponding period in 2023.
Scentre Group has established a reliable track record as a Dividend Paying Company, demonstrating consistent growth in dividend per share (DPS) over recent years.
The Group anticipates further growth in dividend cash flows, forecasting an increase from 0.08 AUD per share in August 2024 to 0.09 AUD by August 2025, and reaching 0.10 AUD by February 2028.
McMillan Shakespeare Limited (ASX: MMS)
McMillan Shakespeare’s compelling investment appeal lies in its strong industry and operating fundamentals supporting substantial revenue growth year on year while the company’s approach towards margin expansion and cost management has also supported a substantial increase in profitability from $63 million in 2022 to $97 million in 2023.
The company anticipates that its business activities in the second half of FY24 will closely align with the first half, continuing to deliver notable financial growth. MMS is particularly focused on capitalizing on organic growth opportunities within the EV market, driven by a robust auto supply chain and the expected increase in EV adoption throughout the year. Additionally, the company aims to enhance marketability by adopting a proactive approach to customer engagement and sales activities. Furthermore, the company intends to collaborate with the National Disability Insurance Agency (NDIA) concerning the independent review of the NDIS. This engagement is anticipated to increase demand and support revenue growth for its Plan and Support Services (PSS) segment.
MMS has a track record of being a consistent dividend payer, with its recent interim fully franked dividend of 76.0 cps, compared to 58.0 cps in the same period last fiscal year. This dividend represents a 100% payout ratio of Normalised UNPATA.
MyState Limited (ASX: MYS)
MyState Limited operates banking, trustee, and managed fund services through its wholly owned subsidiaries, MyState Bank Limited (MyState Bank) and TPT Wealth Limited (TPT Wealth).
The company's financial performance is showing positive trends reflected by the reduction in both the Price-to-Sales (P/S) and Price-to-Earnings (P/E) ratios. The P/S ratio declined from 2.87x in 1H22 to 0.95x in 1H24, signaling a reduced valuation of sales revenue. Similarly, the P/E ratio decreased from 13.91x in 1H22 to 10.68x in the same period, reflecting a lower valuation of earnings. The decline indicating improved efficiency in generating sales and a more favorable assessment of earnings by investors.
The company has established itself as a reliable dividend payer, with its dividend yield showing a consistent increase since 2020. It declared a final dividend of 11.5 cents per share, fully franked, for the 2023 fiscal year. This was followed by the decision to maintain the interim dividend at 11.5 cents per share during the first half of FY24, resulting in a slightly higher payout ratio of 72.6%. This steadfast approach highlights the company's dedication to delivering returns to shareholders while maintaining prudent financial management practices.
Source : Company Reports
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