Are these the best ASX dividend shares to buy next week?

What is Morgans saying about these dividend shares?

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The good news for income investors is that there are a large number of quality ASX dividend shares to choose from on the Australian share market.

But which could be buys next week? Well, two that Morgans rates high enough to have on its best ideas list are listed below. Here's what it likes about them:

QBE Insurance Group (ASX: QBE)

The first ASX dividend to consider buying according to Morgans is QBE. It has an add rating and a $17.16 price target on the insurance giant's shares.

The broker likes QBE because it believes it is well-placed to benefit from rate increases and cost outs. Its analysts explain:

With strong rate increases still flowing through QBE's insurance book, and further cost-out benefits to come, we expect QBE's earnings profile to improve strongly over the next few years. The stock also has a robust balance sheet and remains relatively inexpensive overall trading on 8x FY24F PE.

As for dividends, the broker has pencilled in dividends per share of 66 cents in FY 2023 and 93 cents in FY 2024. Based on the current QBE share price of $15.71, this will mean a yield of 4.2% and 5.9%, respectively.

Wesfarmers Ltd (ASX: WES)

Another ASX 200 dividend share that has been named as a buy is Wesfarmers. Morgans has the Bunnings and Kmart owner on its best ideas list with an add rating and a $55.15 price target on its shares.

The broker believes Wesfarmers is well-positioned in the current environment thanks to its focus on value. It commented:

WES possesses one of the highest quality retail portfolios in Australia with strong brands including Bunnings, Kmart and Officeworks. The company is run by a highly regarded management team and the balance sheet is healthy. We believe WES's businesses, which have a strong focus on value, remain well-placed for growth and market share gains in a softening macroeconomic environment.

In respect to dividends, Morgans is forecasting fully franked dividends per share of $1.91 in FY 2024 and $2.18 in FY 2025. Based on the current Wesfarmers share price of $51.27, this will mean yields of 3.7% and 4.25%, respectively.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Wesfarmers. The Motley Fool Australia has positions in and has recommended Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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