Income investors are a lucky bunch!
That's because there are so many ASX dividend shares to choose from on the Australian share market. So many, it can be hard to decide which ones to buy above others.
But don't worry, because brokers have been busy doing the hard work for you and have picked out a couple that they think are buys. Here's why they are bullish on them:
HomeCo Daily Needs REIT (ASX: HDN)
Morgans thinks that HomeCo Daily Needs could be an ASX dividend share to buy this month.
It is a property company with a focus on neighbourhood retail and large format retail assets. At the last count, its three largest tenants were Coles Group Ltd (ASX: COL), Wesfarmers Ltd (ASX: WES), Woolworths Group Ltd (ASX: WOW).
Morgans believes that HomeCo Daily Needs is well-placed for growth over the long term. This is thanks to favourable trends and its development pipeline. It explains:
The portfolio has resilient cashflows and continues to be a beneficiary of accelerating click & collect trends. +80% of tenants are national and ~75% of tenants offer click & collect reinforcing the importance of assets being able to support 'last mile logistics'. Sites are also in strategic locations with strong population growth (+80% metro). HDN offers an attractive distribution yield and the development pipeline provides growth opportunities.
Morgans expects this to support the payment of dividends per share of 8.5 cents in FY 2025 and then 8.7 cents in FY 2026. Based on the current HomeCo Daily Needs share price of $1.30, this will mean dividend yields of 6.5% and 6.7%, respectively.
Morgans currently has an add rating and $1.36 price target on its shares.
SRG Global Ltd (ASX: SRG)
SRG Global could be a great ASX dividend share to buy. It is a diversified industrial services group that provides multidisciplinary construction, maintenance, production drilling and geotechnical services.
Bell Potter is feeling very bullish about the company and its outlook. So much so, it has named SRG Global on its favoured list again this month. The broker believes that it will be a beneficiary of accelerating growth in iron ore and gold production volumes over the next five years. It explains:
SRG's short-to-medium term outlook is reinforced by Government-stimulated construction activity in the Infrastructure and Non-Residential sectors and increased development and sustaining capital expenditures in the Resources industry. The resulting expansion in infrastructure bases across these sectors will likely support increased demand for asset care and maintenance in the medium to long-term. We anticipate Mining Services will be a beneficiary of accelerating growth in iron ore and gold production volumes over the next five years.
In respect to dividends, the broker is forecasting fully franked dividends of 5 cents in FY 2025 and then 6 cents in FY 2026. Based on its current share price of $1.04, this will mean dividend yields of 4.8% and 5.75%, respectively.
Bell Potter has a buy rating and $1.40 price target on its shares.
