Fortunately, in this low interest rate environment, there are countless dividend shares for investors to choose from on the Australian share market.
But with so many to choose from, it can be hard to decide which ones to buy. To narrow things down, I have picked out three ASX dividend shares brokers think investors should buy:
Coles Group Ltd (ASX: COL)
According to a note out of Credit Suisse, its analysts have retained their outperform rating and $18.19 price target on this supermarket operator's shares. This follows a review of supermarket trading conditions. The broker is expecting Coles to declare a 63 cents per share fully franked dividend in FY 2021 and then a 67.6 cents per share dividend next year. Based on the current Coles share price of $16.69, this will mean yields of 3.8% and 4.1%, respectively, over the next two years.
DEXUS Property Group (ASX: DXS)
A note out of Morgan Stanley reveals that its analysts have retained their overweight rating and $11.70 price target on this property company's shares. This follows the company's decision to acquire a 7% stake in Australian Unity's Healthcare Trust for $180 million. Morgan Stanley is forecasting distributions of 50.3 cents per share in FY 2021 and then 48.8 cents per share in FY 2022. Based on the current DEXUS share price of $10.81, this implies potential yields of almost 4.7% and 4.5%, respectively.
Fortescue Metals Group Limited (ASX: FMG)
Analysts at Macquarie have retained their outperform rating and lifted their price target on this iron ore producer's shares to $27.00. The broker made the move after upgrading its forecasts to reflect high iron ore prices. In respect to dividends, Macquarie is expecting a $3.40 per share dividend in FY 2021 and a $2.43 per share dividend in FY 2022. Based on the current Fortescue share price of $23.32, this represents fully franked yields of 14.5% and 10% over the next two financial years.
