2 ASX 200 dividend shares named as buys for October

These dividend shares are in the buy zone according to analysts…

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Are you looking for dividend shares to buy in October? If you are, then you may want to look at the two listed below.

Here’s why these ASX 200 dividend shares could be in the buy zone:

BHP Group Ltd (ASX: BHP)

The first ASX 200 dividend share to look at is BHP. This mining giant’s shares have come under significant pressure in recent weeks after the iron ore price tumbled.

And while the speed of the decline was unexpected, analysts had been warning for a long time that US$200 a tonne iron ore was unsustainable.

The good news is that the price of the steel making ingredient appears to have stabilised for the time being a little north of US$100. At this level BHP is still generating significant free cash flow from its iron ore operations. In addition, the company has a diverse collection of operations with exposure to a range of commodities.

The team at Macquarie remain very positive on BHP. Last week the broker retained its outperform rating and $56.00 price target on the Big Australian’s shares.

Macquarie is also forecasting fully franked dividends per share of ~$3.70 in FY 2022 and ~$2.90 in FY 2023. Based on the current BHP share price of $37.61, this implies yields 9.8% and 7.7%, respectively.

Coles Group Ltd (ASX: COL)

Another ASX 200 dividend share to consider for October is Coles. Especially after its shares pulled back by 8% in September.

This has left the Coles share price trading at an attractive level according to analysts at Morgans. The broker currently has an add rating and $19.80 price target on its shares. This suggests that there is upside of 17% for its shares over the next 12 months.

In addition, the share price weakness means that the yield on offer with the supermarket giant’s shares has widened.

Morgans is forecasting fully franked dividends per share of 61 cents in FY 2022 and 62 cents in FY 2023. Based on the current Coles share price of $16.99, this will mean yields of 3.6% and 3.65%, respectively.

Should you invest $1,000 in BHP right now?

Before you consider BHP, you'll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and BHP wasn't one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

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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. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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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