Brokers name 2 quality ASX dividend shares to buy

Transurban Group (ASX:TCL) and this ASX dividend share could be great options for income investors. Here’s why…

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A young entrepreneur boy catching money at his desk, indicating growth in the ASX share price or dividends

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With savings accounts and term deposits still offering very low interest rates, the share market arguably remains the best place to earn a passive income.

However, with so many dividend shares to choose from, it can be hard to decide which ones to buy. Luckily, brokers have been doing the hard work for you and have picked out two to buy. They are as follows:

Super Retail Group Ltd (ASX: SUL)

Super Retail is a retail conglomerate that owns the BCF, Macpac, Rebel, Supercheap Auto brands.

It has been growing at a solid rate in recent years and particularly during FY 2021. With international tourism off the cards, Super Retail has been benefiting greatly from a redirection in consumer spending.

This led to the company reporting a 23% increase in sales to $1.78 billion and a massive 139% increase in underlying net profit after tax to $177.1 million during the first half.

Goldman Sachs appears to believe more of the same is coming in the second half. And the good news for shareholders is that it expects this to lead to the company rewarding shareholders with a special dividend with its full year results.

The broker expects a dividend of ~81 cents per share in FY 2021. Based on the current Super Retail share price, this equates to a fully franked 6.5% yield. Goldman Sachs has a buy rating and $15.00 price target on its shares.

Transurban Group (ASX: TCL)

Another dividend share to consider is Transurban. This toll road operator owns a collection of important roads in Australia and North America which offer significant time-savings and have strong pricing power. This includes CityLink in Melbourne and the Cross City Tunnel and Eastern Distributor in Sydney.

While the pandemic led to a sharp drop in traffic volumes, volumes are improving and will continue to do so as vaccines roll out.

One broker that believes it won’t be long until its distributions rebound is Ord Minnett. It recently retained its buy rating and $16.00 price target on its shares.

The broker is forecasting dividends of 37 cents per share in FY 2021 and 58 cents per share in FY 2022. Based on the latest Transurban share price, this equates to yields of 2.6% and 4.1%, respectively, over the next two years.

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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 Australia owns shares of Transurban 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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