2 ASX dividend shares with big yields

Analysts rate these dividend shares highly…

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Are you looking for some dividend shares to boost your income portfolio? If you are, then you might want to look at the ones listed below.

Here’s why these high yield ASX dividend shares could be in the buy zone:

Adairs Ltd (ASX: ADH)

The first dividend share to look at is Adairs. It is a leading retailer of homewares and home furnishings in Australia and New Zealand through both retail stores and online channels.

It has been in fine form over the last 12 months thanks to a redirection in consumer spending and the housing market boom. This led to Adairs reporting a 28.5% increase in sales to $499.8 million and the almost doubling of its earnings before interest and tax to $109.1 million.

While it will be hard to top this in FY 2022, the team at UBS are still expecting a generous dividend. Its analysts are forecasting fully franked dividends of 19.6 cents per share in FY 2022 and then 29.9 cents per share in FY 2023.

Based on the current Adairs share price of $3.91, this will mean yields of 5% and 7.6%, respectively. UBS has a buy rating and $5.40 price target on its shares.

South32 Ltd (ASX: S32)

Another ASX dividend share to look at is mining giant. South32 has exposure to a range of commodities such as alumina, aluminium, energy coal, metallurgical coal, manganese ore, nickel, silver, lead, and zinc. The key commodity right now is arguably aluminium.

This is because analysts at Goldman Sachs believe aluminium is in the early stages of a multi-year bull market. This bodes well for South32 and could underpin strong earnings and free cash flows in the coming years.

As a result, the broker has put South32’s shares on its conviction buy rating with a $3.80 price target.

In addition to this, the broker is forecasting some very generous dividends in the coming years. Goldman has pencilled in dividends per share of 29 US cents in FY 2022 and 31.9 US cents in FY 2023. Based on current exchange rates and the latest South32 share price of $3.51, this will mean fully franked yields of approximately 11% and 12%, respectively.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended ADAIRS FPO. The Motley Fool Australia owns shares of and has recommended ADAIRS FPO. 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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