2 buy-rated ASX dividend shares for income investors

Sydney Airport Holdings Pty Ltd (ASX:SYD) and this ASX dividend share could be quality options for income investors. Here's why…

As was widely expected, on Tuesday the Reserve Bank of Australia elected to keep the cash rate on hold at the record low of 0.1%.

Unfortunately, this looks likely to remain the case for some time to come, possibly even years.

In light of this, dividend shares look likely to remain the best place to earn a passive income for the foreseeable future.

But which ASX dividend shares should you buy? Here are two to consider:

asx dividend shares represented by tree made entirely of money

Image source: Getty Images

Coles Group Ltd (ASX: COL)

The first ASX dividend share to look at is this supermarket operator. It could be a good option for investors due to its strong business model, refreshed strategy, and positive long term outlook.

Goldman Sachs is a big fan of the company and last week put a buy rating and $20.50 price target on its shares. It continues to forecast solid growth in earnings and dividends over the coming years.

In respect to the latter, the broker is forecasting dividends per share of 62 cents in FY 2021 and 66 cents in FY 2022. Based on the current Coles share price of $16.50, this will mean fully franked yields of 3.75% and 4%, respectively, over the next two years.

Sydney Airport Holdings Pty Ltd (ASX: SYD)

This airport operator could be a good option for patient investors. This is because with domestic tourism recovering and vaccines rolling out across the world, it may not be long until Sydney Airport's terminals are packed full of passengers again.

One broker that is positive on the company is Goldman Sachs. It believes it is worth being patient with Sydney Airport and currently has a buy rating and $6.73 price target on its shares.

And while the broker isn't expecting a material dividend yield this year, it is forecasting a swift recovery.

Based on the current Sydney Airport share price, its analysts are forecasting dividend yields of 1.6% in FY 2021 and then 4.5% in FY 2022.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of COLESGROUP DEF SET. 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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