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Top South African (JSE) Dividend Stocks
UPDATED Jun 28, 2022
What are the best South African (JSE) Dividend Stocks?
According to our Simply Wall St analysis these are the best South African dividend companies. We look for companies with high quality dividends and healthy balance sheets to find the top Dividend Stocks.
Our criteria to find Top Dividend Companies
High Yield
- Companies with a high dividend yield are more attractive due to the higher expected income for each dollar invested.
- Yields vary between markets, so we focus on the top dividend payers in each market.
What do we look for?
- Is the yield in the top 25% of the market's dividend payers.
Consistent Dividends
- Companies with a strong track record of paying a consistent and growing dividend are the most attractive.
- If the dividend has been cut substantially in the past, then it's difficult to be confident about future payments.
What do we look for?
- Has the dividend been stable over the last 10 years.
- Has the dividend grown over the last 10 years.
Dividend Cover
- Ideally the company doesn't pay out all of its earnings, neglecting future growth.
- If a company is unable to afford its dividend, then it will probably lead to a dividend cut and share price erosion.
What do we look for?
- Are dividends covered by earnings.
- Are dividends forecast to be covered by earnings in the future.
Healthy Balance Sheet
- Investors want to make sure the company is positioned to cover its debts. Repayments on debt typically take priority over shareholder return initiatives.
What do we look for?
- Does the company have a manageable level of debt.
- Is the company able to cover its interest repayments.
6 companies meet this criteria in the South African market
African Rainbow Minerals Limited, through its subsidiaries, operates as a diversified mining and minerals company in South Africa and Malaysia.
Dividend Criteria
Earnings Coverage
Growing Dividend
Future Dividend Coverage
High Dividend: ARI's dividend (14.4%) is in the top 25% of dividend payers in the ZA market (8.78%)
Notable Dividend
Stable Dividend
Rewards
Trading at 88.2% below our estimate of its fair value
Earnings are forecast to grow 13.8% per year
Earnings grew by 73.9% over the past year
Risks
No risks detected for ARI from our risks checks.
Vodacom Group Limited operates as a connectivity, digital, and financial services company in South Africa and internationally.
Dividend Criteria
Stable Dividend
Earnings Coverage
Growing Dividend
Future Dividend Coverage
Notable Dividend
High Dividend: VOD's dividend (6.28%) is low compared to the top 25% of dividend payers in the ZA market (8.78%).
Rewards
Trading at 46.8% below our estimate of its fair value
Earnings are forecast to grow 13.59% per year
Earnings grew by 3.5% over the past year
Risks
No risks detected for VOD from our risks checks.
FirstRand Limited, together with its subsidiaries, provides banking, transactional, lending, insurance, and investment products and services in South Africa, rest of Africa, the United Kingdom, rest of Europe, North America, and Asia.
Dividend Criteria
Earnings Coverage
Growing Dividend
Future Dividend Coverage
Notable Dividend
High Dividend: FSR's dividend (4.76%) is low compared to the top 25% of dividend payers in the ZA market (8.78%).
Stable Dividend
Rewards
Earnings are forecast to grow 11.83% per year
Earnings grew by 121.8% over the past year
Risks
No risks detected for FSR from our risks checks.
Astral Foods Limited operates as an integrated poultry producer in South Africa and internationally.
Dividend Criteria
Earnings Coverage
Growing Dividend
Future Dividend Coverage
Notable Dividend
High Dividend: ARL's dividend (8.29%) is low compared to the top 25% of dividend payers in the ZA market (8.78%).
Stable Dividend
Rewards
Trading at 56.8% below our estimate of its fair value
Earnings are forecast to grow 16.79% per year
Earnings grew by 100.2% over the past year
Risks
No risks detected for ARL from our risks checks.
Nedbank Group Limited, together with its subsidiaries, provides various wholesale and retail banking services in South Africa and internationally.
Dividend Criteria
Earnings Coverage
Growing Dividend
Future Dividend Coverage
Notable Dividend
High Dividend: NED's dividend (6.96%) is low compared to the top 25% of dividend payers in the ZA market (8.78%).
Stable Dividend
Rewards
Price-To-Earnings ratio (9.5x) is below the Banks industry average (10.8x)
Earnings are forecast to grow 14.75% per year
Earnings grew by 224.1% over the past year
Risks
High level of non-cash earnings
Absa Group Limited, together with its subsidiaries, provides various financial products and services in South Africa and internationally.
Dividend Criteria
Earnings Coverage
Growing Dividend
Future Dividend Coverage
Notable Dividend
High Dividend: ABG's dividend (5.94%) is low compared to the top 25% of dividend payers in the ZA market (8.78%).
Stable Dividend
Rewards
Trading at 0.5% below our estimate of its fair value
Earnings are forecast to grow 10.86% per year
Earnings grew by 202.1% over the past year
Risks
No risks detected for ABG from our risks checks.