Are you wanting to strengthen your income portfolio?
If you answered yes to this question, then read on because Bell Potter has just named one of the best ASX dividend stocks to buy now.
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Which ASX dividend stock?
The stock that gets a big thumbs up from the broker is Cedar Woods Properties Ltd (ASX: CWP).
It is a residential property developer with a portfolio diversified by geography, price point and product type.
Bell Potter was impressed with its performance in FY 2025, highlighting that its earnings and dividend were ahead of expectations. In addition, the ASX dividend stock's guidance for the year ahead was slightly stronger than forecast. The broker commented:
CWP announced its FY25 result with EPS of 58.4c above BPe (+3.4%) and Bloomberg consensus (+2.9%), with DPS of 29.0c also above BPe (+3.6%) and consensus (+1.8%). FY26 guidance has been established for NPAT growth of approx. +10% which was marginally ahead of BPe and consensus.
Speaking of FY 2026, its analysts point out that with significant presales locked in, its earnings for the year ahead are largely de-risked. It adds:
CWP had $660m of presales on hand at 30 June, of which we expect 60% (or $396m) to underpin FY26 revenues (c.75% of BPe FY26e revenue). Our bottom-up analysis suggests a more diversified than usual contribution to earnings from different projects, which gives management more ability to pull different levers to active earnings if needed.
Time to buy
In response to its results, Bell Potter has reaffirmed its buy rating on Cedar Woods' shares with an improved price target of $8.75 (from $8.00).
Based on its current share price of $7.50, this implies potential upside of 17% for investors over the next 12 months.
In addition, the broker is forecasting dividend increases to 33 cents per share in FY 2026, 36 cents per share in FY 2027, and then 38 cents per share in FY 2028. This would mean fully franked dividend yields of 4.4%, 4.8%, and 5.1%, respectively.
Commenting on its buy recommendation, the broker said:
We adjust our FY26-28 EPS estimates by +0% to +3% to reflect: (1) improved margins; (2) higher sales rates at affordable land projects; and (3) impact of full year actuals. We increase our TP +9.4% to $8.75 and maintain the Buy rating on CWP, a key pick of ours in the sector, which continues to screen attractively at just 11.5x BPe FY26 earnings, a discount to both its peers and its own 5yr average of c.13x, as well as a BPe 4.4% fully franked FY26e dividend yield.
