There are plenty of ASX dividend shares for investors to choose from. So, which ones should you buy?
Two that have recently been tipped as buys and are forecast to pay growing dividends are listed below. Here's why brokers are bullish on them:
Coles Group Ltd (ASX: COL)
Coles could be an ASX dividend share to buy according to analysts at Citi.
The broker was pleased with a recent tour of Coles' new Automated Distribution Centre (ADC) in Queensland. The centre reinforces Citi's "view that Coles is moving in the right direction and the ADCs have the potential to provide a cost advantage over competitors."
All in all, the broker believes Coles is well-placed to deliver solid earnings and dividend growth through to at least FY 2025.
This is expected to lead to fully franked dividends per share of 69 cents in FY 2023, 73 cents in FY 2024, and then 80 cents in FY 2025. Based on the current Coles share price of $18.18, this represents yields of 3.8%, 4% and 4.4%, respectively.
Citi has a buy rating and $20.20 price target on its shares.
Universal Store Holdings Ltd (ASX: UNI)
This youth fashion retailer could be an ASX dividend share to buy after being hammered this week.
Investors were hitting the sell button after a trading update revealed that demand from its customer base has been softening due to the cost of living crisis.
This surprised the market because its target demographic was expected to continue spending largely as normal due to a lack of exposure to rising rates and the benefits of a higher minimum wage.
Goldman Sachs believes this has created a buying opportunity for investors. It notes that Universal Store's shares are now "trading on 8.0x our revised FY24E earnings (46% below historical average PER)."
In addition, the broker estimates that Universal Store's shares will provide investors with fully franked dividend yields of approximately 6.4% in FY 2023, 7.5% in FY 2024, and then 8.9% in FY 2025.
Goldman has a buy rating and $5.00 price target on its shares.
