While a generous dividend yield is always welcome when you're an income investor, a generous yield that can grow is even better.
The good news is that there are a couple of ASX dividend shares that are expected to increase their dividends in the near future.
Another positive that could sweeten the deal even further for investors is that analysts also believe their shares can rise meaningfully from current levels.
Which shares? I hear you ask. Well, let's take a look:
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Universal Store Holdings Ltd (ASX: UNI)
Morgans is a fan of this fashion retailer. This is due to its exposure to younger consumers that are less impacted by rising interest rates.
The broker currently has an add rating and $6.85 price target on its shares. Based on the latest Universal Store share price of $5.00, this suggests that its shares could rise 37% from current levels.
As for dividends, the broker is expecting the company to be in a position to increase its fully franked dividend to 30 cents in FY 2023 and then 35 cents in FY 2024. This implies yields of 6% and 7%, respectively, for investors over the next couple of years.
Westpac Banking Corp (ASX: WBC)
Over at Goldman Sachs, its analysts are feeling positive about Australia's oldest bank. They believe it is well-placed in the current environment. This is thanks to its cost-cutting plans and potential net interest margin improvements.
The broker currently has the bank on its conviction list with a buy rating and $27.74 price target. Based on the current Westpac share price of $22.28, this implies potential upside of almost 25% for investors over the next 12 months.
In addition, the broker is expecting the banking giant to increase its fully franked dividend to 147 cents per share in FY 2023 and then to 156 cents per share in FY 2024. This will mean yields of 6.6% and 7%, respectively.
