2 highly rated ASX dividend shares to buy

Telstra Corporation Ltd (ASX:TLS) and this ASX dividend share come highly rated. Here's what you need to know…

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Thankfully in this ultra-low interest rate environment, there are a large number dividend shares for investors to choose from on the Australian share market.

Two ASX dividend shares that could be top options for income investors are listed below. Here's why they come highly rated:

Accent Group Ltd (ASX: AX1)

The first dividend share to look at its Accent Group. It is a leading footwear retailer with a (growing) number of popular store brands. This area of the retail sector has been a particularly positive performer in 2020 despite the pandemic. This led to Accent Group delivering a solid result in FY 2020, which allowed it to reward shareholders with a generous dividend.

The good news is that this strong form has carried over into FY 2021. The company recently revealed that its like for like sales (excluding its Auckland and Victorian stores) were up 15.7% during the first 20 weeks of the financial year. It also revealed a stunning 129% increase in Digital sales compared to the prior corresponding period.

Morgan Stanley was pleased with this update and has a buy rating on its shares. It is also forecasting a fully franked dividend of 9.4 cents per share this year. Based on the current Accent share price, this represents a 4.4% dividend yield.

Telstra Corporation Ltd (ASX: TLS)

Another dividend share to look at is Telstra. This telco giant has been a disappointing performer over the last few years due to the impact of the NBN rollout. The good news is that the end of the rollout is in sight and the headwind is finally easing.

Combined with the arrival of 5G internet, cost cutting, and its T22 strategy, Telstra has been tipped to return to growth again in the not so distant future. In addition to this, the company is aiming to create value for shareholders by splitting its business into three separate entities. Management believes the restructure would enable the company to take advantage of potential monetisation opportunities.

Goldman Sachs likes what it sees here and recently reiterated its buy rating and $3.60 price target on Telstra's shares. It has also reaffirmed its estimate for a 16 cents per share fully franked dividend in FY 2021 and beyond. Which, based on the current Telstra share price, would provide investors with a 5.25% dividend yield.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia has recommended Accent Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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