2 quality ASX dividend shares with 5%+ yields

BHP Group Ltd (ASX:BHP) and this ASX dividend share offer investors yields of 5% or more. Here's why they could be buys…

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With the interest rates on term deposits falling to ultra low levels, it has become very hard for investors to generate a sufficient income from this popular financial asset.

Fortunately, there are a good number of dividend shares which can replace your term deposits and provide you with generous yields.

Two to consider are listed below. Here's what you need to know about them:

BHP Group Ltd (ASX: BHP)

The Big Australian is one of the world's largest miners and the owner of a portfolio of world class and low cost operations. With iron ore and copper prices trading at lofty levels and oil prices hitting nine-month highs this week, the company is in a great position to deliver another strong full year result in FY 2021.

Analysts at Macquarie certainly expect this to be the case. Last week the broker put an outperform rating and $46.00 price target on the miner's shares. It is also forecasting a fully franked ~$3.85 per share dividend in FY 2021. Based on the current BHP share price, this represents a very generous 8.9% dividend yield.

Westpac Banking Corp (ASX: WBC)

With the banking sector appearing to be over the worst of its COVID issues, APRA allowing unrestricted dividend payments, and house prices tipped to climb materially next year, the big four banks have become very popular with investors in recent months. The good news is that one leading broker doesn't believe it is too late to invest.

According to a recent note out of UBS, its analysts have a buy rating and $22.00 price target. The broker is also forecasting a $1.00 per share dividend in FY 2021 and then a $1.20 per share dividend in FY 2022. Based on the current Westpac share price, this represents fully franked ~5% and 5.9% dividend yields, respectively.

Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia has no position in any of the stocks mentioned. 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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