Forget term deposits and buy these ASX dividend shares

These dividend shares have been tipped by analysts to provide investors with yields that are superior to term deposits.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

While the yields on offer from term deposits are a lot more attractive than they were a couple of years ago, they still don't match up to some of the dividend yields available on the Australian share market.

So, if your risk tolerance allows for it, it could pay to invest in shares rather than term deposits. But which ASX dividend shares?

Three buy-rated ASX dividend shares that are tipped to provide investors with 5%+ yields are listed below. Here's why they could be worth considering:

Person holding Australian dollar notes, symbolising dividends.

Image source: Getty Images

Accent Group Ltd (ASX: AX1)

The team at Bell Potter is expecting some big yields and major upside from Accent Group's shares. It is a footwear focused retailer with over 800 stores across a large number of brands. This includes Sneaker Lab, Platypus, Stylerunner, and The Athlete's Foot.

Bell Potter currently has a buy rating and $2.50 price target on its shares.

As for that all-important income, the broker is expecting fully franked dividends per share of 13 cents in FY 2024 and then 14.6 cents in FY 2025. Based on the latest Accent share price of $1.80, this represents dividend yields of 7.2% and 8.1%, respectively.

Stockland Corporation Ltd (ASX: SGP)

The team at Citi thinks that Stockland could be an ASX dividend share to buy.

It is a property company that develops, owns, and manages retail centres, business parks, logistics centres, office buildings, residential communities, and retirement living villages.

Much like Accent, the broker expects some very attractive and term deposit-busting yields from its shares in the near term. The broker is forecasting dividends per share of 26.2 cents in FY 2024 and then 26.6 cents in FY 2025. Based on the current Stockland share price of $4.65, this will mean yields of 5.6% and 5.7% yields, respectively.

Citi currently has a buy rating and $5.20 price target on its shares.

Transurban Group (ASX: TCL)

A third ASX dividend share that is tipped to provide better yields than term deposits is Transurban.

It is a toll road giant with a growing number of important roads across both Australia and North America. This includes the Cross City Tunnel and Eastern Distributor in Sydney, and CityLink and the West Gate Tunnel Project in Melbourne.

Citi is a fan of the company and is forecasting dividends per share of 63 cents in FY 2024 and 65 cents in FY 2025. Based on the current Transurban share price of $12.43, this will mean yields of 5.1% and 5.2%, respectively.

Citi has a buy rating and $15.50 price target on its shares.

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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 Transurban Group. The Motley Fool Australia has recommended Accent Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Dividend Investing

View of a business man's hand passing a $100 note to another with a bank in the background.
Bank Shares

New ANZ dividend: Here's everything you need to know

ANZ's new dividend has just been revealed.

Read more »

A man points at a paper as he holds an alarm clock, indicating the ex-dividend date is approaching.
Dividend Investing

16 ASX shares going ex-dividend in May

Newmont is among the ASX shares to go ex-dividend this month.

Read more »

Man holding fifty Australian Dollar banknotes in his hands, symbolising dividends.
Dividend Investing

3 star ASX dividend income stocks for the rest of 2026

I rate these businesses as strong income buys.

Read more »

Children skipping and jumping up a hill.
Dividend Investing

Want passive income? These ASX dividend shares offer 5%+ yields

These companies grow their payouts over time.

Read more »

A golden egg with dividend cash flying out of it
Dividend Investing

These ASX dividend shares keep giving investors a pay rise

I think these businesses are excellent options for regular payout growth.

Read more »

A graphic of a pink rocket taking off above an increasing chart.
Dividend Investing

$1,000 buys 23 shares in an incredibly reliable ASX 200 dividend stock

This business offers incredible reliability with dividends.

Read more »

A happy elderly man wearing a red cape smiles as he jumps up like a hero from a massage table.
Dividend Investing

3 ASX dividend stocks I'd buy if I were a retiree

Reliable dividends often come from predictable demand. These three stocks highlight where that stability can be found.

Read more »

Beautiful young couple enjoying in shopping, symbolising passive income.
Dividend Investing

3 ASX dividend shares to build a passive income

Looking for passive income? These shares have been named as buys by analysts.

Read more »