The Australian share market traditionally trades with an average dividend yield of approximately 4%.
While this is a good yield and better than most savings accounts and term deposits, there are even better yields out there for income investors.
Let's look at three buy-rated ASX dividend shares that Morgans are tipping to offer above-average yields in the near term. They are as follows:
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HomeCo Daily Needs REIT (ASX: HDN)
The first ASX dividend share that analysts are tipping as a buy is HomeCo Daily Needs. It is a property company with a focus on neighbourhood retail, large format retail, and health and services.
Morgans rates the company highly. This is due to its shift in focus from large format retail to daily needs. The broker believes that this positions HomeCo Daily Needs for growth in the coming years.
For example, it is forecasting 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 $1.16, this will mean yields of 7.3% and 7.5%, respectively.
The broker currently has an add rating and $1.36 price target on its shares.
Inghams Group Ltd (ASX: ING)
A second ASX dividend share that analysts at Morgans are positive on is Inghams. It is Australia's leading poultry producer and supplier.
Morgans appears to believe that the market is undervaluing its shares at present. Especially given its strong market position and the prospect of big dividend yields.
In respect to the latter, the broker is forecasting fully franked dividends of 19 cents per share in both FY 2025 and FY 2026. Based on the current Inghams share price of $3.21, this equates to dividend yields of 5.9% in both years.
The broker currently has an add rating and $3.66 price target on its shares.
Woodside Energy Group Ltd (ASX: WDS)
A final ASX dividend share that could offer an above-average dividend yield according to Morgans is energy giant Woodside.
The broker believes that recent weakness has left its shares trading at an attractive level. It highlights that "WDS' share price implies a near cycle-low oil price level."
It then adds that its analysts "maintain an ADD recommendation believing WDS offers attractive long-term value."
As for income , the broker is forecasting fully franked dividends of $1.85 per share in FY 2024 and $1.54 per share in FY 2025. Based on its current share price of $25.75, this will mean yields of 7.2% and then 6%.
Morgans currently has an add rating and $33.00 price target on Woodside's shares.
