3 Top ASX Dividend Stocks To Watch

As the ASX200 experiences a modest rise driven by positive economic indicators from both domestic and international fronts, Australian investors are keenly observing sectors like Real Estate and Financials for their robust performance. In this climate of cautious optimism, dividend stocks present an attractive opportunity for those seeking steady income streams amidst fluctuating market conditions.

Top 10 Dividend Stocks In Australia

Name	Dividend Yield	Dividend Rating
Nick Scali (ASX:NCK)	4.39%	★★★★★☆
Fiducian Group (ASX:FID)	4.46%	★★★★★☆
Super Retail Group (ASX:SUL)	7.84%	★★★★★☆
MFF Capital Investments (ASX:MFF)	3.01%	★★★★★☆
Premier Investments (ASX:PMV)	5.19%	★★★★★☆
National Storage REIT (ASX:NSR)	4.74%	★★★★★☆
New Hope (ASX:NHC)	7.89%	★★★★☆☆
Sugar Terminals (NSX:SUG)	7.77%	★★★★☆☆
Grange Resources (ASX:GRR)	10.00%	★★★★☆☆
Australian United Investment (ASX:AUI)	3.52%	★★★★☆☆

Click here to see the full list of 32 stocks from our Top ASX Dividend Stocks screener.

Let's review some notable picks from our screened stocks.

New Hope (ASX:NHC)

Simply Wall St Dividend Rating: ★★★★☆☆

Overview: New Hope Corporation Limited engages in the exploration, development, production, and processing of coal as well as oil and gas properties, with a market cap of A$4.17 billion.

Operations: New Hope Corporation Limited's revenue is primarily derived from its Coal Mining operations in New South Wales, contributing A$1.56 billion, and Queensland, which includes treasury and investments, contributing A$166.52 million.

Dividend Yield: 7.9%

New Hope Corporation's dividend yield of 7.89% ranks in the top 25% of Australian dividend payers, but its sustainability is questionable due to a high cash payout ratio of 113.7%, indicating dividends are not well covered by free cash flows. Recent operating results show significant coal production, yet profit margins have declined from last year. While trading below estimated fair value and offering good relative value, its dividend history has been volatile over the past decade.

• Delve into the full analysis dividend report here for a deeper understanding of New Hope.
• Our expertly prepared valuation report New Hope implies its share price may be lower than expected.

Servcorp (ASX:SRV)

Simply Wall St Dividend Rating: ★★★★☆☆

Overview: Servcorp Limited offers executive serviced and virtual offices, coworking spaces, and IT, communications, and secretarial services with a market cap of A$485.43 million.

Operations: Servcorp Limited generates revenue primarily from its Real Estate - Rental segment, amounting to A$314.89 million.

Dividend Yield: 4.8%

Servcorp's dividend payments are well-supported by both earnings, with a payout ratio of 59.7%, and free cash flows, reflected in a low cash payout ratio of 14.2%. Despite this coverage, the dividend yield of 4.8% is modest compared to top-tier Australian payers. Although dividends have grown over the past decade, their reliability is questionable due to volatility exceeding 20% annually at times. The stock trades significantly below its estimated fair value, suggesting good relative value.

• Click here and access our complete dividend analysis report to understand the dynamics of Servcorp.
• In light of our recent valuation report, it seems possible that Servcorp is trading behind its estimated value.

Southern Cross Electrical Engineering (ASX:SXE)

Simply Wall St Dividend Rating: ★★★★☆☆

Overview: Southern Cross Electrical Engineering Limited offers electrical, instrumentation, communications, security, and maintenance services to the resources, commercial, and infrastructure sectors in Australia with a market cap of A$371.30 million.

Operations: Southern Cross Electrical Engineering Limited generates revenue primarily from the provision of electrical services, amounting to A$551.87 million.

Dividend Yield: 4.3%

Southern Cross Electrical Engineering's dividends are covered by earnings (payout ratio of 72%) and cash flows (cash payout ratio of 46.7%), yet the dividend yield of 4.27% is below Australia's top payers. Despite a decade-long increase in dividends, their reliability is marred by volatility over 20% annually at times. The stock trades at a notable discount to its estimated fair value, with analysts anticipating significant price appreciation potential.

• Click here to discover the nuances of Southern Cross Electrical Engineering with our detailed analytical dividend report.
• According our valuation report, there's an indication that Southern Cross Electrical Engineering's share price might be on the cheaper side.

Summing It All Up

• Unlock more gems! Our Top ASX Dividend Stocks screener has unearthed 29 more companies for you to explore.Click here to unveil our expertly curated list of 32 Top ASX Dividend Stocks.
• Are these companies part of your investment strategy? Use Simply Wall St to consolidate your holdings into a portfolio and gain insights with our comprehensive analysis tools.
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Ready To Venture Into Other Investment Styles?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.
• Find companies with promising cash flow potential yet trading below their fair value.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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