ASX Dividend Stocks Featuring New Hope And Two More Top Picks

The Australian market remained flat over the last week, but it has shown a robust 17% increase over the past year, with earnings projected to grow by 13% annually. In this context of steady growth, dividend stocks like New Hope and others can offer investors an attractive blend of income and potential capital appreciation.

Click here to see the full list of 33 stocks from our Top ASX Dividend Stocks screener.

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

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

Overview: New Hope Corporation Limited engages in the exploration, development, production, and processing of coal, oil, and gas properties with a market capitalization of A$4.06 billion.

Operations: New Hope Corporation Limited’s revenue primarily comes from its Coal Mining NSW segment, which generated A$1.56 billion, and its Coal Mining QLD (including Treasury and Investments) segment, which contributed A$166.52 million.

Dividend Yield: 8.1%

New Hope’s dividend yield of 8.11% ranks in the top 25% of Australian dividend payers, but it faces sustainability concerns due to a high cash payout ratio of 113.7%. Despite recent earnings declines, with net income dropping to A$475.86 million from A$1.09 billion last year, dividends have increased over the past decade. However, their volatility and lack of coverage by free cash flows suggest caution for investors prioritizing stable income streams.

• Navigate through the intricacies of New Hope with our comprehensive dividend report here.

• Our expertly prepared valuation report New Hope implies its share price may be lower than expected.

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$493.33 million.

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

Dividend Yield: 4.7%

Servcorp’s dividend profile shows a mixed picture, with recent increases including a 14% rise in fiscal year 2024 dividends to 25.0 cents per share and plans for at least 26.0 cents in fiscal year 2025. Despite past volatility, current payouts are well-covered by earnings (59.7% payout ratio) and cash flows (14.2% cash payout ratio). Trading below estimated fair value, its dividend yield of 4.72% is lower than the top quartile of Australian payers but remains sustainable given robust earnings growth and coverage metrics.