Luckily for income investors in this low interest rate environment, the ASX 200 is home to a number of quality shares that are forecast to pay generous dividends in the near term.
Two ASX 200 dividend shares that could be in the buy zone are listed below:
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BHP Group Ltd (ASX: BHP)
The first ASX 200 dividend share to look at is this mining giant. The Big Australian could be a top option due to its world class operations, favourable commodity prices, and strong balance sheet. The latter means the company is likely to return the vast majority of its free cash flow to shareholders through dividends. And with iron ore currently trading close to US$120 a tonne, there certainly will be a lot of free cash flow being generated.
Macquarie is very bullish on BHP and currently has an outperform rating and $63.00 price target on its shares. The broker is also forecasting fully franked dividends of ~$4.07 and $3.82 per share in FY 2021 and FY 2022, respectively. Based on the latest BHP share price of $51.05, this will mean generous yields of 8% and 7.5% over the next two years.
Coles Group Ltd (ASX: COL)
Coles could be an ASX 200 dividend share to buy. This is thanks to its strong market position, defensive qualities, positive growth outlook, and favourable dividend policy. The latter sees the supermarket giant aim to pay out upwards of 90% of its earnings to shareholders each year as dividends.
Goldman Sachs remains very positive on Coles. It currently has a buy rating and $19.40 price target on its shares. The broker is also forecasting fully franked dividends of 62 cents per share in FY 2021 and then 67 cents per share in FY 2022. Based on the current Coles share price of $16.65, this represents yields of 3.7% and 3.9%, respectively, over the next two years.
