Fortunately in this low interest rate environment, there are countless dividend shares for investors to choose from on the Australian share market.
But with so many to choose from, it can be hard to decide which ones to buy.
To narrow things down, I have picked out three ASX dividend shares that brokers think investors should buy:
BHP Group Ltd (ASX: BHP)
According to a note out of Ord Minnett, its analysts have upgraded this mining giant's shares to a buy rating with a $44.00 price target. Although it is expecting BHP's iron ore exports to be softer in the first quarter, it remains confident that BHP is on track to achieve its full year production guidance in FY 2021. Given current commodity prices, it expects this to lead to a strong profit result and a ~$2.22 per share fully franked dividend. Based on the latest BHP share price, this represents a generous 6% dividend yield.
National Australia Bank Ltd (ASX: NAB)
Analysts at Citi have retained their buy rating and $23.50 price target on this banking giant's shares. According to the note, the broker has reduced its earnings estimates slightly to reflect lower net interest income assumptions. Nevertheless, the broker sees a lot of value in its shares at the current level and continues to rate them as a buy. It is forecasting a fully franked dividend of 80 cents per share in FY 2021. Based on the current NAB share price, this equates to a 4.3% dividend yield.
Transurban Group (ASX: TCL)
A note out of UBS reveals that its analysts have retained their buy rating and $15.50 price target on this toll road operator's shares following its latest quarterly update. While Transurban posted another sizeable decline in traffic volumes during the quarter, the broker remains positive on the medium term. It notes that new projects are coming online and expects them to boost its growth in the coming years. For now, UBS is forecasting a FY 2021 dividend of 44 cents per share. Based on the current Transurban share price, this will provide investors with a 3.15% yield.
