A fair whack of ASX small caps don’t pay dividends, but there are exceptions — and apparently some pay better than their large cap counterparts.

According to Bloomberg the average dividend yield for large cap (ASX 200) stocks is 3.4 per cent.

But Stockhead found 21 stocks that paid dividends with yields greater than this (based on yesterday’s share price).

The top stock paid a 25 per cent dividend. South Australian copper miner Hillgrove Resources (ASX:HGO) paid a dividend of 1.5c per share in June.

It is not that common for resources juniors to pay dividends but Hillgrove is able to because it is already in production, delivering around 20,000 tonnes of copper per annum at its Kanmatoo project.

Live stock dealer Ruralco (ASX:RHL) paid 84c per share, a yield of 19 per cent. But it will be the last dividend paid because it is in the process of being taken over and will be removed from the ASX this Friday.

Meanwhile, tyre supplier National Tyre & Wheel (ASX:NTD) paid a yield of 9.1 per cent this earnings season. Despite negative consumer sentiment in most industries, it exceeded its earning guidance, recording $12.8m.

 

Aviation coughs up the cash

Other stocks that paid better than the average dividend included aviation stocks Regional Express (ASX:REX) and Alliance Aviation (ASX:AQZ).

The latter has enjoyed slow and steady growth, servicing the mining sector which is performing even as consumption in the rest of the economy stagnates. Qantas became a substantial holder earlier this year.

Regional Express, however, has declined in the last 12 months despite a $17m profit. It was hit with accusations of neglecting safety by a disgruntled employee earlier this year.

Despite the struggles of retail, two of the highest payers were in that very industry – The Reject Shop (ASX:TRS) and Adairs (ASX:ADH). These firms paid 5.8 per cent and 4.8 per cent yields respectively.

Code Name Price (I) Dividend per share Dividend Yield Market Cap
HGO HILLGROVE RESOURCES LTD 0.06 0.015 25% 38.06M
RHL RURALCO HOLDINGS LTD 4.4 0.84 19.10% 461.18M
NTD NATIONAL TYRE & WHEEL LTD 0.39 0.0355 9.10% 40.13M
SHM SHRIRO HOLDINGS LTD 0.66 0.04 6.10% 62.76M
REX REGIONAL EXPRESS HOLDINGS LT 1.39 0.08 5.80% 153.67M
TRS REJECT SHOP LTD/THE 1.89 0.1 5.30% 55.21M
RXP RXP SERVICES LTD 0.59 0.03 5.10% 93.44M
ADH ADAIRS LTD 1.68 0.08 4.80% 291.94M
GLB GLOBE INTERNATIONAL LTD 1.51 0.07 4.60% 62.61M
ENN ELANOR INVESTOR GROUP 2.25 0.0974 4.30% 224.60M
WPP WPP AUNZ LTD 0.55 0.023 4.20% 455.90M
GTN GTN LTD 0.81 0.032 4.00% 181.44M
ICS ICSGLOBAL LTD 1.15 0.045 3.90% 12.17M
BFG BELL FINANCIAL GROUP LTD 0.93 0.035 3.80% 295.08M
DWS DWS LTD 1.07 0.04 3.70% 141.06M
QIP QANTM INTELLECTUAL PROPERTY 1.29 0.048 3.70% 172.97M
ED1 EVANS DIXON LTD 0.83 0.03 3.60% 193.97M
FRI FINBAR GROUP LTD 0.83 0.03 3.60% 225.86M
IGL IVE GROUP LTD 2.14 0.077 3.60% 318.65M
AQZ ALLIANCE AVIATION SERVICES L 2.55 0.088 3.40% 323.03M
MWY MIDWAY LTD 2.61 0.09 3.40% 223.58M

 

But is it just all about the cash?

Shareholders will no doubt happily receive dividends over the next few weeks, but CommSec economist Craig James said companies need to consider more than just topping up shareholders’ bank balances.

“Adequate cash must be maintained to pay out dividends together with confidence on future profitability,” he said earlier this week.

“But cash levels as well as modest borrowings are important for reinvestment in the business and applied to new opportunities — entering new markets or engaging in mergers and acquisitions.”

He also noted some shareholders might want capital expenditure, but said in his view the global economy was slowing and hence not conducive for major investments.