Income investors are spoilt for choice when it comes to ASX dividend shares on the local market.
To narrow things down, let's take a look at two that have been named as buys by brokers.
Here's what they are recommending to clients:
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Collins Foods Ltd (ASX: CKF)
Morgans is a fan of this quick service restaurant operator and has been pleased with its performance in a tough operating environment.
Commenting on its recent results, the broker said:
In our view, CKF reported a solid result in light of tough conditions. NPAT grew 17.6%, at the mid-point of guidance. COGS are expected to be flat to modest in FY27, which is better than feared. KFC Australia 1H27-to-date SSS of +4.0% is a stronger-than-expected start. Europe disappointed with early 1H27 SSS tracking deeply negative, though attributable to factors outside CKF's control. Balance sheet remains strong with ND/EBITDA of 0.8x, keeping CKF well placed to fund the German expansion, accelerate Kwench rollout, and pursue further German bolt-on acquisitions.
While the composition of our forecasts has changed, the net profit impact is minor. We believe CKF remains undervalued for its growth profile. Despite the tough consumer environment, CKF proves resilient regardless of numerous challenges and continues to deliver solid growth. We retain our BUY recommendation and revise our price target to A$10.60 from A$12.50.
Morgans is forecasting fully franked dividends per share of 31 cents in FY 2027 and 35 cents in FY 2028. Based on its current share price of $7.95, this would mean dividend yields of around 4% and 4.4%, respectively.
The broker has a buy rating and $10.60 price target on the company's shares.
Harvey Norman Holdings Ltd (ASX: HVN)
Another ASX dividend share that brokers are bullish on is retail giant Harvey Norman.
Bell Potter expects FY 2027 to be a tough year, but believes this is more than priced in. And with generous yields expected, it sees now as a good time to snap up Harvey Norman's shares. It said:
While our views on FY27e sees challenging conditions for retailers with a recovery weighted to 2H, on our revised estimates HVN continues to trade at a 1-year forward P/E of ~13x (as per BPe) which appears attractive.
We see mid-longer term growth catalysts related to the new store driven growth in international retailing (UK, Malaysia, Croatia), refit program in Australia, expansion of brand partnerships in the midpremium end of the whitegoods market somewhat offsetting the risk in the mid-market space and opportunities to grow their real estate portfolio as Australia's single largest owner in large format retail with a global portfolio of ~$4.6b. We maintain BUY.
Bell Potter is forecasting fully franked dividends of 31.1 cents per share in FY 2027 and then 33.3 cents per share in FY 2028. Based on its current share price of $4.75, this equates to dividend yields of 6.6% and 7%, respectively.
The broker currently has a buy rating and $6.00 price target on its shares.
