2 ASX shares to buy for a retirement portfolio in FY25

Analysts have put buy ratings on these stocks. Here's why they could be worth considering for retirees.

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If you are in the process of building a retirement portfolio, then it could be worth looking at the ASX shares in this article.

That's because they are high-quality companies and appear well-positioned to grow their earnings and dividends over the long term.

Let's see what analysts are saying about them now:

Brickworks Limited (ASX: BKW)

Analysts at Bell Potter think that Brickworks could be an ASX share to buy. Its analysts are very positive on the building products company's outlook and appear to believe its long run of dividend increases can continue. The broker commented:

Despite some recent normalisation in market rent growth and vacancies, near-term supply in BKW's precincts continues to remain heavily pre-committed. BKW has recently secured DA approval for Oakdale East 2 (250k sqm GLA) and last month announced Amazon (58k sqm GLA) as its anchor tenant, providing the group with strong optionality and, in our view, an effective 12 to 18 month lead on most incoming local supply. Over FY25- 26e we see development potentially approaching 100k+ sqm p.a. (+$20- 25m p.a. gross rent or 11-13% p.a.). Given BKW's relatively short-WALE and 30-35% under-rented book, a relatively benign annual mark-up should then see rent growth in the mid-teens fairly comfortably, in our view.

Bell Potter expects dividend yields in the region of 2.5% in the near term. It also sees room for its shares to climb from current levels with its buy rating and $29.00 price target.

Woolworths Limited (ASX: WOW)

Woolworths could be an excellent ASX share for a retirement portfolio in FY 2025. This is because the supermarket giant's shares were sold off in the last financial year, which appears to have created a compelling buying opportunity today.

Goldman Sachs certainly believes this is the case. The broker explained:

We are Buy rated on the stock as we believe the business has among the highest consumer stickiness and loyalty among peers, and hence has strong ability to drive market share gains via its omni-channel advantage, as well as its ability to pass through any cost inflation to protect its margins, beyond market expectations. The stock is trading below its historical average (since 2018), and we see this as a value entry level for a high-quality and defensive stock.

As for income, its analysts believe that Woolworths is positioned to increase its dividend each year until at least FY 2026. This will mean 3%+ dividend yields each year.

But the biggest positive is arguably its valuation. Goldman has a buy rating and $40.20 price target on Woolworths shares, which suggests that they could rise 19% from current levels.

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 Brickworks and Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended Brickworks. 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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