If you're looking for cheap ASX dividend shares to buy, then you may want to check out the two listed below.
Here's why brokers are bullish on these beaten down dividend shares:
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Baby Bunting Group Ltd (ASX: BBN)
This baby products retailer could be an ASX dividend share to buy according to analysts at Morgans. It has an add rating and $3.60 price target on its shares.
With the Baby Bunting share price down over 50% in 2022 and 30% since its recent annual general meeting, the broker sees this "as an overreaction and a buying opportunity." Particularly given its defensive qualities and compelling growth opportunity. Morgans commented:
With the shares nearly 30% lower than they were before the AGM, there has, in our view, been an overreaction to the update. BBN is still the largest specialist in a comparatively defensive retail segment. It still has compelling opportunities to grow its share of a growing market through store rollout, entry into New Zealand, range expansion and the launch of an online marketplace. It's trading on 12x FY24 P/E. ADD.
In respect to dividends, Morgans is forecasting fully franked dividends per share of 14 cents in FY 2023 and then 16 cents in FY 2024. Based on the current Baby Bunting share price of $2.61, this will mean yields of 5.35% and 6.1%, respectively.
Domino's Pizza Enterprises Ltd (ASX: DMP)
Another ASX dividend share that has been beaten down in 2022 is this pizza chain operator. Its shares have lost almost half of their value this year amid softer sales and inflationary pressures on its margins.
Morgans sees this as a buying opportunity and has recently retained its add rating with an improved price target of $90.00.
The broker believes its share price weakness has been overdone and highlights that Domino's "cost pressures are intense in the near-term, but they will pass." It commented:
We believe these pressures are transitory in nature. In our opinion, now is the best time to consider an investment in a quality business like DMP that is facing headwinds that will reverse in time.
As for dividends, it is forecasting partially franked dividends per share of $1.55 in FY 2023 and $1.89 in FY 2024. Based on the current Domino's share price of $63.88, this will mean yields of 2.4% and 3%, respectively.
And while these are not the biggest yields you'll find on the Australian share market, the company is aiming to double its store network (before acquisitions) over the next decade. If this is successful, there's potential for major dividend increases in the future. It could pay to be patient.
