2 quality ASX dividend shares with generous yields

BHP Group Ltd (ASX:BHP) and this ASX dividend share offer generous yields that smash current interest rates…

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You’re not alone if you’re fed up with the low interest rates on offer with savings accounts and term deposits.

But don’t worry, because the Australian share market is here to save the day with its countless dividend options.

Two ASX dividend shares that can help you smash low rates are listed below:

BHP Group Ltd (ASX: BHP)

The first ASX dividend share to look at is this mining giant.

The Big Australian has been in fine form this year thanks to its exposure to a number of key commodities experiencing very strong prices.

Chief among them is iron ore, which is threatening to break through the US$200 a tonne level. This is significantly higher than its production cost, leading to bumper free cash flows.

Pleasingly, due to its strong balance sheet and generous dividend policy, the majority of this free cash flow is likely to end up in shareholders’ pockets.

One bullish broker is Macquarie. It currently has an outperform rating and $57.00 price target on its shares. This compares to the latest BHP share price of $47.70.

Macquarie is forecasting dividends per share of ~$3.49 and ~$2.96 over the next two years. This equates to fully franked yields of 7.3% and 6.2%, respectively.

Charter Hall Social Infrastructure REIT (ASX: CQE)

A second ASX dividend share to consider is the Charter Hall Social Infrastructure REIT.

This real estate investment trust owns a portfolio  of properties with specialist use, limited competition, and low substitution risk.

Among its portfolio you will find bus depots, police and justice services facilities, and childcare centres.

In respect to the latter, the Charter Hall Social Infrastructure REIT is the country’s largest owner of early learning centres. It actively partners with 35 high quality childcare operators.

During the first half of FY 2021,  the company was also in fine form. It reported a 14.1% increase in operating earnings to $29.1 million. Another couple of positives were it weighted average lease expiry (WALE) increasing to 14 years and its occupancy rate of 99.7%.

This strong form allowed management to upgrade its FY 2021 distribution guidance to 15.7 cents per unit. Based on the current Charter Hall Social Infrastructure share price, this represents a 4.8% yield.

One broker that is a fan is Goldman Sachs. It currently has a conviction buy rating and $3.45 price target on its shares.

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*Returns as of January 12th 2022

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. 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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