Are you looking for some dividend options for your income portfolio next week? If you are, then take a look at the two ASX 200 dividend shares listed below that analysts at Goldman Sachs rate as strong buys.
Here’s why the broker is positive on them:
Elders Ltd (ASX: ELD)
The first ASX 200 dividend share to that the broker rates highly is Elders. It is an agribusiness company that provides services to rural and regional customers across the ANZ region.
Goldman Sachs likes the company due to its positive growth outlook, acquisition opportunities, and its margin expansion potential. The broker commented:
We view ELD as well-positioned to achieve continued organic growth through market rationalisation and margin expansion as the company executes on the backward integration strategy, which it is c.50% of the way through. Organic growth looks set to be complemented by further bolt-on acquisitions, with c.620 independents in the Australian market with a steady stream of founders now looking at succession or exit opportunities. We forecast a further +7% EBIT growth in FY23 vs. Bloomberg consensus of -13%.
In respect to dividends, Goldman is forecasting dividends per share of 50 cents in FY 2022 and 53 cents in FY 2023. Based on the current Elders share price of $12.51, this would mean yields of 4% and 4.2%, respectively.
Goldman Sachs also sees plenty of upside ahead for its shares. It currently has a conviction buy rating and $21.00 price target on them.
Westpac Banking Corp (ASX: WBC)
Another ASX 200 dividend share that Goldman Sachs rates as a strong buy is banking giant Westpac.
The broker likes Australia’s oldest bank due to its major cost cutting programme and exposure to rising rates. It explained:
We continue to see WBC as our preferred exposure to the A&NZ Financials reflecting: i) its strong leverage to rising rates, ii) while we think its A$8 bn FY24 cost target will now be unachievable, we still forecast a 7% reduction in underlying expenses, iii) its recent market update highlighted that the business is still investing effectively in its franchise.
As for dividends, Goldman is forecasting fully franked dividends per share of 123 cents in FY 2022 and 135 in FY 2023. Based on the current Westpac share price of $21.88, this will mean yields of 5.6% and 6.2%, respectively.
Goldman also has Westpac on its conviction list. The broker currently has a conviction buy rating and $26.12 price target on the bank’s shares.
The post Goldman Sachs names 2 ASX 200 dividend shares to buy next week appeared first on The Motley Fool Australia.
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More reading
- The Westpac share price has fallen the most of the ASX 200 big four banks over the past year. So, is it a cheap buy?
- How did the Westpac share price manage to beat the ASX 200 in September?
- Here’s how ASX 200 bank shares fared in the shocker month of September
- These ASX dividend shares have been tipped as buys by experts
- Will the Westpac share price rebound in October?
Motley Fool contributor James Mickleboro has positions in Westpac Banking Corporation. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Elders Limited and Westpac Banking Corporation. 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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