2 ASX 200 dividend shares to buy according to brokers

Brokers are positive on these dividend shares…

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If you’re wanting to add some ASX 200 dividend shares to your portfolio, then it could be worth considering the two listed below.

Here’s why analysts think they could be top options for income investors:

South32 Ltd (ASX: S32)

The first ASX 200 dividend share to look at is South32. It is diversified mining and metals company producing a range of commodities including alumina, aluminium, bauxite, coal, copper, manganese, nickel, and silver across operations in Australia, Southern Africa and South America.

Goldman Sachs is a big fan of the company. It currently has a conviction buy rating and $5.80 price target on the miner’s shares.

The broker commented: “We are Buy rated on S32.AX (on CL) with strong FCF [free cash flow] (17% base case for FY23), exposure to base metals (75% EBITDA; aluminium & alumina c. 50% of FY23 EBITDA, copper c.10 %, zinc/nickel c. 20%), and with 7%/3% Cu Eq production growth in FY22/FY23.”

It is because of that strong free cash flow that Goldman is forecasting fully franked dividend yields of 10% in FY 2022 and ~14% in FY 2023 and FY 2024.

Transurban Group (ASX: TCL)

Another ASX 200 dividend share to consider is toll road operator Transurban. The team at Morgans is positive on the company and currently has an add rating and $14.29 price target on its shares.

Morgans notes that Transurban’s performance has been improving, with traffic volumes recovering nicely from the pandemic. It expects this to underpin an equally quick recovery in its dividends.

It commented: “TCL owns a pure play portfolio of toll road concession assets located in Melbourne, Sydney, Brisbane, and North America. This provides exposure to regional population and employment growth and urbanisation. […] Watch for rapid recovery in DPS alongside traffic recovery and WestConnex acquisition prospects.”

Morgans is forecasting dividends per share of 37 cents in FY 2022 and then 60 cents in FY 2023. Based on the current Transurban share price of $13.99, this implies yields of 2.6% and 4.3%, respectively.

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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