3 dividend shares to buy in September?

Some dividends are facing cuts this year, but I still see plenty I might buy. I’m considering these three, with updates due in September.

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Many dividend shares out there offer big forecast yields. That doesn’t mean the cash is guaranteed, though. No, we’ve already seen some dividends, like Rio Tinto‘s, being cut. And rising inflation and economic pressures could lead to more being pared back.

Here I’m looking at three that I’m considering buying in September, depending on how their latest news turns out.

Bricks

One is Redrow (LSE: RDW), with full-year results due on 14 September. Housebuilder shares have slumped this year. I didn’t think they would, as demand has remained strong. But a fall has to be a buying opportunity for those of us who see long-term gains, surely.

Redrow’s forecast dividend yield stands at 6.5%. That’s fairly modest compared to some in the sector. But last year’s was covered three times by earnings, which I think takes some of the pressure off.

The company launched a share buyback programme in July, too. It intends to return up to £100m to shareholders that way. When there’s capital to spare like that, I feel even better about a company’s long-term dividend prospects.

A prolonged period of high inflation and interest rates could harm housebuilder share prices, though. And that has to be the biggest danger.

Food

Maybe it’s the contrarian in me. But I like the look of a number of real estate investment trusts (REITs) these days. And for me, Supermarket Income REIT (LSE: SUPR) ticks the boxes.

The share price has been erratic over the short term, but it’s showing longer-term strength.

The trust holds a portfolio of UK supermarket real estate assets. And that’s got to be one retail business that will still need the big bricks and mortar facilities no matter how our shopping habits might change.

Dividends have been yielding around 5% in recent years, and forecasts suggest similar to come. I like the supermarket sector, and I rate Tesco as a long-term buy.

But I can’t help seeing this REIT as a diversified play on the whole sector.

What are the downsides? I wonder if the share price might be a bit overheated, and if fears of property price falls might turn it downwards. Full-year results are due on 21 September.

Money

I have my eye on Investec (LSE: INVP), with a trading update due on 23 September. Investec is a FTSE 250 bank, focused on private and corporate banking and wealth management. As such, I hope it will be more resilient in the face of higher interest rates.

I think its share price shows that, remaining reasonably buoyant in 2022.

Investec operates primarily in the UK and South Africa. And I do think that brings risk into the equation, as South Africa’s political situation could be getting a little tense. And investors potentially withdrawing funds would not be good.

Earnings and dividends slumped during the pandemic. But the year ended March 2022 saw things back to pre-Covid levels, with a well-covered 5% dividend yield.

I’m not sure I’d buy Investec shares over a UK bank stock if I only held one. But I think it might make a nice addition to my existing Lloyds investment.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Alan Oscroft has positions in Lloyds Banking Group. The Motley Fool UK has recommended Lloyds Banking Group, Redrow, and Tesco. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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