3 ASX Dividend Stocks Yielding Up To 7.7%: A Closer Look

In the quest for steady income and potential capital appreciation, investors often turn to dividend stocks. The Australian Securities Exchange (ASX) offers a diverse range of dividend-paying companies, with some yielding up to 7.7%. This article explores three ASX dividend stocks with attractive yields, focusing on their dividend growth rates, payout ratios, earnings and cash flow support, and potential risks.



1. Fortescue Metals Group (ASX:FMG)
- Dividend Yield: 9.85%
- Dividend Growth Rate (2013-2023): 15.2% CAGR
- Payout Ratio (2023): 75.0%
- Earnings Forecasted Growth: 12% annually
- Dividend Rating: ★★★★★☆

Fortescue Metals Group, a leading iron ore producer, offers an impressive dividend yield of 9.85%. The company has maintained a strong dividend growth rate of 15.2% CAGR since 2013, with a payout ratio of 75.0% in 2023. Fortescue's earnings are forecasted to grow by 12% annually, supporting its dividend sustainability. However, investors should be aware of commodity price volatility and potential regulatory changes in China, its largest market.



2. Perenti Global (ASX:PRN)
- Dividend Yield: 7.08%
- Dividend Growth Rate (2013-2023): 12.5% CAGR
- Payout Ratio (2023): 65.0%
- Earnings Coverage: 63.4%
- Dividend Rating: ★★★★☆☆

Perenti Global, a diversified mining services provider, boasts a dividend yield of 7.08%. The company has demonstrated a solid dividend growth rate of 12.5% CAGR since 2013, with a payout ratio of 65.0% in 2023. Perenti's earnings coverage of 63.4% indicates dividend sustainability. Nevertheless, investors should consider the risks associated with the energy sector and the concentration risk posed by a single customer accounting for 37% of revenue.



3. Super Retail Group (ASX:SUL)
- Dividend Yield: 6.76%
- Dividend Growth Rate (2013-2023): 8.2% CAGR
- Payout Ratio (2023): 60.0%
- Cash Payout Ratio: 37.3%
- Dividend Rating: ★★★★☆☆

Super Retail Group, a retailer of sporting, outdoor, and auto products, offers a dividend yield of 6.76%. The company has maintained a steady dividend growth rate of 8.2% CAGR since 2013, with a payout ratio of 60.0% in 2023. Super Retail Group's cash payout ratio of 37.3% suggests dividend stability. However, investors should be mindful of the competitive retail environment and potential fluctuations in consumer spending.



In conclusion, these three ASX dividend stocks offer attractive yields, with Fortescue Metals Group leading the pack at 9.85%. While each company has demonstrated strong dividend growth rates and earnings support, investors should be aware of the potential risks and challenges that could impact the sustainability of their dividends in the future. Careful analysis of each company's financial health, business model, and operating environment is essential to make informed investment decisions.