SYDNEY, Jan 18, 2026, 22:17 AEDT
On Jan. 18, Motley Fool Australia contributor Tristan Harrison recommended income investors consider L1 Long Short Fund (ASX: LSF) and Washington H. Soul Pattinson (ASX: SOL) as solid picks for dividend-paying stocks to generate “passive income.” 1
The chatter around ASX dividend stocks has picked up again as the local market climbs, with the S&P/ASX 200 closing Friday at its highest since October 2025, according to News Corp’s news.com.au. 2
This week, Morningstar equity analyst Shaun Ler told The Australian the average yield on ASX 200 stocks sits near 3.3%. That number keeps investors questioning how sustainable those dividends actually are. 3
The L1 Long Short Fund aims to generate positive returns by holding both long and short positions—supporting certain shares to climb while wagering against others. According to Financial Times data, L1 Capital manages the fund. 4
Soul Patts describes itself as a diversified investment firm covering listed equities, private capital, credit, and real assets, with the ability to move capital as new opportunities arise. 5
On Jan. 18, a second Motley Fool column titled “A once-in-a-decade chance to get rich” highlighted how some “income stocks” are trading far below previous highs. The drop comes after earnings and dividend forecasts took hits from “soft consumer spending and aggressive discounting.” Contributor Grace Alvino pointed out that “buying during periods of pessimism has historically been how the best income returns are generated,” singling out Accent Group (ASX: AX1), Super Retail Group (ASX: SUL), and Domino’s Pizza Enterprises (ASX: DMP). 6
For many Aussie investors, the talk around dividends often comes back to the banks, where fully franked dividends boost after-tax returns. Franking credits, as explained by the Parliamentary Budget Office, are tax credits tied to certain dividends under Australia’s dividend imputation system. This week, Rask Media highlighted the “gross” dividend approach when assessing Commonwealth Bank’s (ASX: CBA) value through its yield. 7
Accent Group operates over 800 stores and manages a portfolio of 34 brands, such as Platypus, Stylerunner, and The Athlete’s Foot. 8
Super Retail Group reports owning four retail brands across Australia and New Zealand: Supercheap Auto, rebel, BCF, and Macpac. 9
Domino’s Pizza Enterprises, listed on the ASX under the ticker DMP, claims the title of the largest Domino’s franchisee outside the U.S. The Domino’s brand itself is owned by Domino’s Pizza Inc., which is listed in the United States. 10
Rask Media cautioned in a Jan. 12 explainer that “high yields often look attractive on the surface” but may mask companies with weakening fundamentals, strained payout ratios, or pressured cash flow. The report flagged “yield chasing” as a frequent dividend trap. 11
Dividend income isn’t guaranteed, and a high yield often signals trouble rather than health. Emma Rapaport from Centric Wealth cautioned that “a company’s dividend yield can lure investors into risky corners of the market.” Back in November, Mineral Resources chair Malcolm Bundey explained the miner skipped its FY25 dividend as a “prudent” move to shore up its balance sheet. 12
As the ASX reopens after the weekend, investors will be eyeing upcoming earnings reports and board decisions closely. These updates could either reinforce the upbeat income story or prompt a fresh look at the true price of “passive income.”
