Fortunately for income investors, there are plenty of ASX dividend shares to choose from on the Australian share market.

Two that could offer a combination of attractive yields and outsized capital gains are listed below. Here’s why brokers say they are buys:

Macquarie Group Ltd (ASX: MQG)

The first ASX dividend share that could be in the buy zone is investment bank Macquarie.

The team at Morgans is very positive on the bank and recently reiterated its buy recommendation. This is due to its current valuation and exposure to structural growth markets. It commented:

MQG is a quality franchise, exposed to structural growth areas, and the company performed exceptionally well in a more difficult FY23 environment. With >10% share price upside to our price target, we continue to maintain our ADD recommendation.

Morgans has an add rating and $201.80 price target on the company’s shares.

In respect to dividends, the broker is expecting partially franked dividends of $6.33 per share in FY 2023 and $6.75 per share in FY 2024. Based on the current Macquarie share price of $176.51, this will mean yields of 3.6% and 3.8%, respectively.

Super Retail Group Ltd (ASX: SUL)

Another ASX dividend share that could be a buy is Super Retail. It is the retail group behind popular brands such as Macpac, Rebel, and Super Cheap Auto.

Over at Goldman Sachs, its analysts are particularly positive on the retailer. They believe its shares are great value at the current level, especially given its resilient businesses and impressive loyalty program. Goldman believes the latter is a big competitive advantage for the company. It explains:

We believe that the company’s positive trading update continues to display resilience that is built upon its competitive advantage of high loyalty (~10m active members accounting for >70% of sales) and this will be further bolstered in 2H23 as the company launches the Rebel loyalty program and continues to build personalisation capabilities.

Goldman is expecting this to support fully franked dividends per share of 74.1 cents in FY 2023 and then 62.6 cents in FY 2024. Based on the current Super Retail share price of $12.70, this will mean yields of 5.8% and 4.9%, respectively.

The broker has a buy rating and $14.90 price target on its shares.

The post Buy these ASX dividend shares for good yields and outsized returns: analysts appeared first on The Motley Fool Australia.

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More reading

• With interest rates rising, why have ASX 200 bank shares been pummelled in 2023?
• Macquarie shares are going for cheap. Buy the dip?
• Warren Buffett is dumping bank stocks. Should you?
• 4 ASX 200 directors buying and selling their company shares in the past week
• Did you buy the October dip in Macquarie shares? Here’s the dividend yield you’re now earning

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. The Motley Fool Australia has positions in and has recommended Macquarie Group and Super Retail Group. 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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