Experts have named some leading ASX dividend shares as buys.
These are companies that are expected to pay a solid yield in 2022 and potentially deliver long-term growth.
Dividends are not guaranteed and only a few companies have been able to deliver consistent growth. However, analysts are expecting these two businesses to pay attractive dividends this year:
Inghams Group Ltd (ASX: ING)
Inghams is one of Australia's largest poultry businesses, supplying a range of different commercial customers.
It's currently rated as a buy by the broker Credit Suisse with a price target of $4.05. How big is the broker expecting the dividend to be? In FY22 the grossed-up dividend yield is expected to be 4% and in FY23 it's expected to be 8%.
The first half of FY22 was tricky with challenges caused by COVID with lockdowns and operational disruptions.
Inghams continues to invest in achieving operational efficiencies across the business, leading to limited cost growth. This helped underlying net profit grow by 5.9% in the first six months of FY22.
Whilst the ASX dividend share is expecting a shorter-term profit hit, Inghams said that it can recover quickly.
Telstra Corporation Ltd (ASX: TLS)
Telstra is buy-rated by several brokers, including Morgan Stanley which has a price target of $4.60 on the business. This is around 16% higher than where it is today.
In Telstra's recent announcement of its T25 strategy, it said that it was targeting growth of the dividend over time as earnings and franking credits grow. The telco has a number of plans to help grow profit including cutting more costs, diversifying earnings (such as the Digicel Pacific acquisition) and winning market share thanks to 5G. The new 5G offering can help customers switch over to a high-margin fixed wireless service.
The ASX dividend share has committed to keep paying an annual dividend of $0.16 per share. That translates into a grossed-up dividend yield of 5.8% at the current Telstra share price.
Telstra recently announced a regional network sharing agreement with TPG Telecom Ltd (ASX: TPG). TPG will get access to around 3,700 of Telstra's mobile network assets.
Telstra said that this deal with TPG will provide significant value to shareholders. It will realise more value from Telstra's network infrastructure while making a very significant contribution to Telstra's wholesale mobile revenue.
TPG will provide Telstra with access to some of its existing 4G spectrum and 5G spectrum in the regional network.
