Listed below are a couple of dividend shares that brokers believe are in the buy zone right now.
Here’s what income investors need to know about these dividend shares:
Charter Hall Social Infrastructure REIT (ASX: CQE)
The first ASX dividend share that could be in the buy zone is the Charter Hall Social Infrastructure REIT.
This real estate investment trust invests in social infrastructure properties such as bus depots, police and justice services facilities, and childcare centres.
Goldman Sachs is a fan of the REIT and has a conviction buy rating and $4.20 price target on its shares. it commented:
We continue to believe the REIT is positioned for a solid growth outlook given the sector’s positive fundamentals and CQE’s strong balance sheet, with headroom and liquidity to pursue accretive investment opportunities.
As for dividends, the broker is forecasting dividends per share of 17.2 cents in FY 2022 and 18.3 cents in FY 2023. Based on its current share price of $3.57, this implies yields of 4.8% and 5.1%, respectively.
Super Retail Group Ltd (ASX: SUL)
Another ASX dividend share that could be in the buy zone is Super Retail. It is the company behind the BCF, Macpac, Rebel, and Supercheap Auto businesses.
Super Retail’s shares have taken a tumble this year amid concerns over COVID headwinds and its inventory management. However, analysts at Citi remain positive and have a buy rating and $14.00 price target on its shares. The broker believes the market’s concerns are overplayed.
We continue to view the market’s concerns about Super Retail’s elevated inventory position to be significantly overplayed given these strong sales trends, likely minimal risk of ageing given where the inventory is held and management’s perspective on the risks to its supply chain.
In respect to dividends, Citi is expecting fully franked dividends of 66 cents per share in FY 2022 and 64 cents per share in FY 2023. Based on the current Super Retail share price of $9.03, this will mean yields of 7.3% and 7.1%, respectively.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Super Retail Group Limited. The Motley Fool Australia has positions in and has recommended Super Retail Group Limited. 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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