Here are 3 ASX income shares to buy in May

Analysts have buy ratings on these stocks. But why?

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If you're on the lookout for some ASX income shares to buy for next month, then read on!

That's because listed below are three shares that have recently been named as buys:

NIB Holdings Limited (ASX: NHF)

Over at Goldman Sachs, it believes this private health insurer could be an ASX income share to buy.

There are a number of reasons that Goldman is bullish on NIB. One of the main ones is that the health insurer "offers defensive exposure to the private health insurance sector which is experiencing favourable operating trends."

In respect to income, Goldman believes this positions the company to pay fully franked dividends per share of 31 cents in FY 2024 and then 30 cents in FY 2025. Based on the current NIB share price of $7.50, this would mean 4.1% and 4% yields, respectively.

Goldman Sachs has a buy rating and $8.10 price target on NIB's shares.

Orora Ltd (ASX: ORA)

Goldman Sachs also remains very positive on this packaging company despite its struggles this year.

This is partly due to the "relative top-line defensiveness" of its legacy business. In addition, the broker continues to forecast solid earnings growth through to FY 2026 in spite of its underperformance this year.

This is expected to underpin dividends per share of 12 cents in FY 2024 and 13 cents in FY 2025. Based on the current Orora share price of $2.20, this will mean dividend yields of 5.45% and 5.9%, respectively.

Goldman has a buy rating and a $3.00 price target on its shares.

Rural Funds Group (ASX: RFF)

The team at Bell Potter thinks that Rural Funds could be an ASX income share to buy.

It is an agricultural property company that owns almond orchards, macadamia orchards, poultry property and infrastructure, vineyards, cattle properties, cropping properties, cattle and water rights.

Bell Potter's analysts think that now would be a good time to buy Rural Funds' shares. Particularly given that the "~30% discount to market NAV appears excessive when we consider the material improvement in counterparty profitability indicators in recent months."

In addition, the broker expects some very attractive dividend yields from its shares in the coming years. It is forecasting dividends per share of 11.7 cents in both FY 2024 and FY 2025. Based on the current Rural Funds share price of $1.99, this will mean yields of 5.9% in both years for investors.

Bell Potter currently has a buy rating and a $2.40 price target on its shares.

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 Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended NIB Holdings and Rural Funds Group. The Motley Fool Australia has recommended Orora. 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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