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2 top ASX dividend shares with massive yields

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Positively, for income investors in this low interest rate environment, there are a good number of ASX dividend shares offering generous yields.

For example, two ASX dividend yields with particularly big yields are named below. Here’s why they are rated as buys:

Fortescue Metals Group Limited (ASX: FMG)

This mining giant recently released its half year results and revealed a significant increase in all key metrics. This was driven by its low costs, record shipments, and the sky high iron ore price. In respect to the latter, Fortescue reported an average realised price of US$114 per dry metric tonne for its iron ore. This was a massive 42.5% increase on the prior corresponding period.

This underpinned a 44% increase in revenue to US$9,335 million, a 66% lift in net profit after tax to US$4,084 million, and a 93.4% jump in its interim dividend to a fully franked A$1.47 per share.

Analysts at Macquarie were impressed with its result. As a result, they reaffirmed their outperform rating and $26.50 price target. The broker is forecasting a full year dividend of A$2.78 per share. Based on the current Fortescue shares price, this will be a fully franked 11% yield.

Super Retail Group Ltd (ASX: SUL)

Like Fortescue, this retailer recently released a very strong half year result of its own. This was driven by solid growth across the company and its online business.

The company behind retail brands BCF, Macpac, Rebel, and Super Cheap Auto delivered a 23% increase in sales to $1.78 billion and a 139% increase in underlying net profit after tax to $177.1 million. In light of its strong performance, the Super Retail board declared a fully franked interim dividend of 33 cents per share.

Goldman Sachs is a fan of the company. In response to its results, the broker reiterated its buy rating and lifted its price target to $15.00.

Goldman is forecasting a dividend of ~81 cents per share in FY 2021 (including a special dividend). Based on the current Super Retail share price, this equates to a fully franked 7.1% yield.

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Returns As of 15th February 2021

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Super Retail Group Limited. 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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