2 blue chip ASX dividend shares rated as buys

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

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

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

BHP Group Ltd (ASX: BHP)

The first ASX dividend share to look at is BHP. This mining giant’s shares have come under significant pressure since the middle of August. This has of course been driven by a sharp pullback in the iron ore price.

While the is disappointing for shareholders, it could be a buying opportunity for non-shareholders. This is because the iron ore price is still at a level that generates significant free cash flow for BHP. In addition, the prices of other commodities have been rising, offsetting some of iron ore’s decline.

So much so, the team at Morgans still believe BHP will be able to pay a very generous dividend again in FY 2022. Its analysts are forecasting a dividend of $3.95 per share this financial year. Based on the current BHP share price of $37.93, this will mean a yield of 10.4% for investors.

Morgans has an add rating and $46.05 price target on the miner’s shares.

Coles Group Ltd (ASX: COL)

Another blue chip ASX dividend share that Morgans is positive on is Coles.

It likes the supermarket giant due to its strong market position, attractive valuation compared to rival Woolworths Group Ltd (ASX: WOW), and its attractive dividend yield.

In respect to the latter, the broker is forecasting a fully franked 61 cents per share dividend in FY 2022. Based on the current Coles share price of $17.83, this will mean a yield of 3.4% for investors.

Morgans has an add rating and $19.80 price target on its shares.

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.

*Returns as of August 16th 2021

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 owns shares of and has recommended COLESGROUP DEF SET. 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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