3 strong ASX dividend shares to buy for passive income

Analysts think income investors should be snapping up these top stocks.

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Key points

  • Rural Funds Group, Transurban Group, and Universal Store Holdings are identified as ASX dividend shares with attractive yields, recommended as buys by brokers.
  • Rural Funds Group, backed by inflation-linked rental agreements, offers a 6% yield, while Transurban is expected to yield 4.8% and 5.1% based on Citi's forecasts
  • Universal Store, known for its strong growth, is projected to yield 4.3% and 4.8%, with Bell Potter setting a $10.50 price target.

If you are building a passive income portfolio, then it could be worth looking at the ASX dividend shares in this article.

They have been named as buys by brokers and are being tipped to offer attractive dividend yields in the near term. Here's what they are recommending to clients right now:

Rural Funds Group (ASX: RFF)

The first ASX dividend share that is being tipped as a buy is Rural Funds.

It owns a diversified portfolio of farmland, including cattle, vineyards, and cropping properties, which it leases to high-quality tenants on long-term agreements.

As these agreements typically include inflation-linked rental increases, this provides Rural Funds with great visibility on its future earnings. And with global demand for food steadily rising, farmland remains a scarce and valuable asset class. This bodes well for its earnings and dividend growth in the coming years.

Bell Potter is positive on the company and is forecasting dividends per share of 11.7 cents in both FY 2026 and FY 2027. Based on its current share price of $1.93, this would mean dividend yields of 6% for both years.

The broker has a buy rating and $2.45 price target on Rural Funds' shares.

Transurban Group (ASX: TCL)

Over at Citi, its analysts think that Transurban could be an ASX dividend share to buy now.

It is toll road giant with assets across Sydney, Melbourne, Brisbane, and North America. This includes CityLink in Melbourne and the Cross City Tunnel in Sydney.

Citi is positive on the company's outlook and is forecasting dividends per share of 69.9 cents in FY 2026 and then 74.1 cents in FY 2027. Based on its current share price of $14.46, this equates to dividend yields of 4.8% and 5.1%, respectively.

The broker has a buy rating and $16.10 price target on its shares.

Universal Store Holdings Ltd (ASX: UNI)

Finally, Universal Store could be an ASX dividend share to buy according to Bell Potter.

It is the youth fashion retailer responsible for the popular Universal Store, Thrills, and Perfect Stranger brands.

Bell Potter has been impressed with its performance in a tough macroeconomic environment. Its analysts note that they "continue to view distinctive growth traits supporting consistent outperformance in a challenging category, longer term opportunity with three brands, organic gross margin expansion via private label product penetration (currently ~55%) and management execution."

In respect to income, the broker is forecasting fully franked dividends of 36.8 cents in FY 2026 and then 41.1 cents in FY 2027. Based on its current share price of $8.50, this represents dividend yields of 4.3% and 4.8%, respectively.

Bell Potter has a buy rating and $10.50 price target on its shares.

Citigroup is an advertising partner of Motley Fool Money. Motley Fool contributor James Mickleboro has positions in Universal Store. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Transurban Group. The Motley Fool Australia has positions in and has recommended Rural Funds Group. 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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