The Reserve Bank of Australia may have lifted the cash rate to 3.85% this week, but that doesn't automatically mean term deposits are the best place for income seekers.
Even with higher rates flowing through, many term deposits still struggle to compete with the dividend yields available on the share market. And unlike cash in the bank, dividend shares also offer the potential for capital growth over time.
With that in mind, here are three ASX dividend shares that analysts think could be worth considering instead of locking money away in a term deposit.
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Cedar Woods Properties Ltd (ASX: CWP)
The first ASX dividend share to look at is Cedar Woods Properties.
It is one of Australia's leading residential property developers, with a portfolio diversified across geographies, price points, and product types. This diversification helps smooth earnings across the property cycle.
Bell Potter is positive on the company's outlook, highlighting that Cedar Woods is well positioned to benefit from Australia's chronic housing shortage. With demand for new housing continuing to outstrip supply, the broker believes this should support earnings and dividends in the coming years.
Bell Potter is forecasting dividends of 35 cents per share in FY 2026 and 39 cents per share in FY 2027. Based on its current share price of $7.58, this implies dividend yields of 4.6% and 5.1%, respectively.
The broker has a buy rating and $10.00 price target on its shares.
Dexus Convenience Retail REIT (ASX: DXC)
Another ASX dividend share that stands out for analysts is Dexus Convenience Retail.
This REIT owns a nationwide portfolio of service stations and convenience retail sites that are leased to high-quality tenants under long-term, inflation-linked agreements. These leases provide predictable cash flows, which is exactly what income-focused investors typically look for.
The underlying assets are generally considered resilient. Demand for fuel, convenience goods, and essential services tends to hold up through economic cycles, while annual rental increases help protect income over time.
Bell Potter is bullish on the REIT, with a buy rating and a $3.45 price target on its shares. It expects dividends of 20.9 cents per share in FY 2026 and 21.6 cents per share in FY 2027. Based on its current share price of $2.68, that equates to dividend yields of 7.8% and 8%, respectively.
Sonic Healthcare Ltd (ASX: SHL)
A final ASX dividend share to consider according to analysts is Sonic Healthcare.
It is a global medical diagnostics company, operating laboratories and collection centres across Australia, Europe, and the United States. Its services are tied to healthcare demand rather than economic cycles, which can provide a degree of earnings resilience.
Bell Potter believes Sonic Healthcare is approaching a return to more consistent growth and thinks investors should be taking a closer look at its shares. The broker has a buy rating and a $33.30 price target on them.
In terms of income, Bell Potter is forecasting partially franked dividends of 109 cents per share in FY 2026 and 111 cents per share in FY 2027. Based on the current share price of $22.57, this implies dividend yields of 4.8% and 4.9%, respectively.
