Brokers have been busy in recent weeks adjusting their forecasts and recommendations to reflect updates that were given during earnings season.
Two ASX dividend shares that have fared well are listed below. Here's why broker think income investors should be buying these shares:
ANZ Group Holdings Ltd (ASX: ANZ)
According to a note out of Citi, its analysts believe that ANZ is the bank to buy right now. The broker has a buy rating and $29.25 price target on its shares.
It was pleased with ANZ's first-quarter update and believes its earnings are currently ahead of expectations. The broker commented:
Likely a strong quarter for institutional ANZ's 1Q23 disclosures exhibited strong trends in both lending growth and asset quality. No earnings disclosure was provided, but we think that after backing out RWA movements from capital, it comfortably implies above market earnings. […] ANZ remains our top pick in the sector, and we expect the lending momentum, particularly in institutional, to continue to differentiate vs peers.
As for dividends, Citi is forecasting fully franked dividends of 166 cents per share in FY 2023 and then 176 cents per share in FY 2024. Based on the current ANZ share price of $24.49, this will mean yields of 6.8% and 7.2%, respectively.
Universal Store Holdings Ltd (ASX: UNI)
A note out of Morgans reveals that its analysts have an add rating and $7.00 price target on this youth fashion retailer's shares.
Its analysts were impressed with Universal Store's performance during the first half. Pleasingly, they appear to believe that it is well-placed for more of the same in the near term. The broker said:
UNI has opportunities to grow steadily through the rollout of bricks and mortar stores, increased digital penetration and expansion of wholesale channels. While we recognise the general risk around a decline in consumer expenditure on discretionary categories like apparel, we highlight that the youth demographic is likely to be more resilient.
In respect to dividends, Morgans expects fully franked dividends per share of 30 cents in FY 2023 and 35 cents in FY 2024. Based on the latest Universal Store share price of $5.40, this equates to yields of 5.5% and 6.5%, respectively.
