While term deposit interest rates have recently reached some of their highest levels in years, these rates may still fall short of the returns that can be achieved through investments in the Australian share market. With inflation showing signs of stabilization, there is a growing expectation that interest rates might soon decrease, which could signal that term deposit rates have reached their peak. For investors considering alternatives to term deposits, particularly those with a higher risk tolerance, ASX dividend shares could offer a compelling opportunity. Here is an in-depth look at three ASX dividend shares that are worth considering, including their expected dividend yields:
Centuria Industrial REIT (ASX: CIP) Centuria Industrial REIT stands out as Australia's largest domestic pure-play industrial property investment company. This REIT could be an attractive option for income-focused investors due to its strong performance and solid dividend offerings. The forecasted dividends for Centuria Industrial REIT are anticipated to be 16 cents per share for both FY 2024 and FY 2025. With the current share price sitting at $3.15, these dividends translate into a yield of approximately 5.1% for each fiscal year. This yield offers a competitive return compared to many traditional savings options, making it a noteworthy consideration for those seeking reliable income.
IPH Ltd (ASX: IPH) IPH Ltd is an intellectual property services company that operates on a global scale, providing a range of IP-related services. This company has shown a strong ability to generate consistent and defensive earnings, which supports its dividend payments. The anticipated dividends for IPH Ltd are projected to be 34 cents per share for FY 2024 and 37 cents per share for FY 2025. With the current share price at $6.05, these projected dividends yield approximately 5.6% for FY 2024 and 6.1% for FY 2025. The relatively high dividend yields, coupled with the company's stable earnings, make IPH Ltd an appealing option for dividend-seeking investors.
Telstra Group Ltd (ASX: TLS) Telstra Group Ltd is the largest telecommunications company in Australia and represents a significant player in the market. The company is expected to continue delivering steady dividend payments, supported by its strong market position and consistent revenue streams. The forecasted dividends for Telstra Group Ltd are 18 cents per share for FY 2024 and 19 cents per share for FY 2025. Given the current share price of $3.92, these dividends result in yields of approximately 4.6% for FY 2024 and 4.8% for FY 2025. This relatively stable and attractive yield makes Telstra Group Ltd a viable option for those looking for reliable dividend income.
Term deposit rates may currently be high, they might not offer the same potential returns as investments in the share market. For those willing to accept a higher level of risk, ASX dividend shares such as Centuria Industrial REIT, IPH Ltd, and Telstra Group Ltd could provide valuable alternatives with potentially appealing dividend yields. Each of these companies offers unique benefits and could play a significant role in a diversified investment portfolio aimed at maximizing income.