Fortunately, in this low interest rate environment, the ASX 200 is home to a number of shares offering generous yields.
Two ASX 200 dividend shares that could be in the buy zone are listed below. Here's what you need to know about them:
Australia and New Zealand Banking GrpLtd (ASX: ANZ)
The first ASX 200 dividend share to consider is ANZ. It could be a top option for income investors that don't already have exposure to the banking sector.
This is due to its significantly improved outlook, which is being underpinned by Australia's strong economic recovery from the pandemic, the thriving housing market, and cost reductions.
In fact, things have been so positive that ANZ is returning significant capital to investors. It has just announced a $1.5 billion on-market share buyback despite the lockdowns. It also hinted that its surplus capital means further capital management could be coming once things stabilise.
Analysts at Morgans are positive on the company and have an add rating and $34.50 price target on its shares.
The broker is also forecasting fully franked dividends of $1.45 per share in FY 2021 and then $1.65 per share in FY 2022. Based on the latest ANZ share price of $28.89, this represents yields of 5% and 5.7%, respectively.
BHP Group Ltd (ASX: BHP)
Another ASX 200 dividend share to look at is BHP. This mining giant could be a top option for income investors, especially those that are looking to diversify their portfolio by investing in the resources sector.
The Big Australian has a diverse portfolio of world class operations that are benefiting greatly from both strong demand and pricing for commodities. And thanks to its low production costs, this has positioned the company to generate significant free cash flow in the near team.
The team at Macquarie expect this to support very generous dividend payments. The broker is currently forecasting fully franked dividends per share of approximately $3.71 in FY 2021 and then $3.62 in FY 2022. Based on the latest BHP share price of $51.69, this will mean yields of 7.2% and 7%, respectively.
Macquarie currently has an outperform rating and $60.00 price target on its shares.
