If you're willing to be patient, Bell Potter thinks the ASX dividend stock in this article could be worth considering.
That's because the broker believes that after a period of no dividends, this stock could be positioned to provide a dividend yield of 9% in 2027 and then 10% in 2028.
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Which ASX dividend stock?
The stock that Bell Potter is tipping as a buy is Healthco Healthcare and Wellness REIT (ASX: HCW).
It is an externally-managed REIT under parent HMC Capital Ltd (ASX: HMC), which manages around $1.4 billion of healthcare assets. This includes investment in hospitals, aged care, childcare, government, life sciences, and primary care & wellness property assets.
Among its tenant base is a combination of large-scale operators including Healthscope (HSO) and Acurio, as well as the Australian Government, which is the third biggest tenant by gross income.
What is the broker saying?
Its shares have come under significant pressure over the past 12 months due to its exposure to the struggling HSO business.
Commenting on recent developments, the broker said:
All 11 HSO hospitals continue to operate as normal, with 100% of all rent due having been paid, and state-by-state executable lease agreements with alternate operators remains in place as per prior. Incrementally though, HCW now expects upon new leases being struck the terms would include face rents to remain unchanged and incentives would indicatively result in a 10-15% near-term reduction to asset values.
The HSO receiver-led process remains the key determinant in potential pathways head, particularly in regards to UHF equity investment and HCW distribution's recommencing (BPe 1QFY27).
Dividend forecast
Bell Potter doesn't believe there will be any dividends in FY 2026. However, it is expecting them to recommence in FY 2027 with a dividend of 6.3 cents per share. The broker then expects a dividend of 7.5 cents per share in FY 2028.
Based on its current share price of 70 cents, this would mean dividend yields of 9% and 10.7%, respectively, over the two years.
In addition, the broker sees plenty of upside for this ASX dividend stock from current levels. It has a buy rating and 95 cents price target. This suggests that its shares could rise by 36% between now and this time next year.
Commenting on its buy recommendation, the broker said:
No change to our Buy rating. HCW trades at a material -50% discount to NTA which is the widest in our sector coverage, notwithstanding +26bp cap rate expansion at the result (c.+40bps for HSO-tenant assets) and additional detail on potential asset devaluations which implies a higher valuation than the current share price implied.
