Are you looking for dividend shares to buy? If you are, you may want to check out the two listed below that have been tipped to provide attractive yields by Goldman Sachs.
Here's what you need to know about these ASX dividend shares today:
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Healthco Healthcare and Wellness REIT (ASX: HCW)
The first ASX dividend share that Goldman Sachs has tipped as a buy is Healthco Healthcare and Wellness.
Goldman believes the health and wellness focused real estate investment trust is well-placed to pay attractive dividends in the coming years thanks to its strong balance sheet and exposure to government-backed sub-sectors. The broker said:
[T]he REIT remains one of our top picks in the sector given 1) its net cash position with over $450mn of liquidity, providing flexibility for near term opportunities, 2) its diversified mix of strong tenant covenants in sub-sectors that are majority government-backed across the care spectrum, mitigating potential tenant credit risks, 3) Healthcare and childcare assets valuations have remained resilient, 4) the expansive forecast future demand for assets across the care spectrum, underpinning development opportunities, and 5) inexpensive valuation.
In respect to dividends, Goldman expects dividends per share of 7.5 cents in both FY 2023 and FY 2024. Based on the current Healthco Healthcare and Wellness REIT unit price of $1.66 this will mean yields of 4.5% for investors.
Goldman has a conviction buy rating and $2.14 price target on its shares.
Westpac Banking Corp (ASX: WBC)
Another ASX dividend share that Goldman Sachs rates highly is Australia's oldest bank, Westpac.
Goldman believes that Westpac is well-placed to benefit from a combination of rising interest rates and its cost cutting plans. It commented:
We remain Buy (on CL) rated on WBC given: i) while on the surface, the FY22 result suggested WBC's NIM leverage was underwhelming relative to some peers, we think 2H22 was adversely impacted by late-in-the-half liquidity build, and management's guidance on its FY23 NIM trajectory was better than we had previously anticipated, ii) despite WBC revising its FY24E cost target to A$8.6 bn (from A$8.0 bn), the bank's performance on cost management remains strong in this inflationary environment with a 9% step down in costs expected over the next two years
Its analysts are expecting this to lead to fully franked dividends per share of 148.4 cents in FY 2023 and 160 cents in FY 2024. Based on the current Westpac share price of $23.76, this will mean yields of 6.25% and 6.7%, respectively.
Goldman Sachs has a conviction buy rating and $27.60 price target on the bank's shares.
