Forget Westpac shares and buy these ASX income stocks

Westpac Banking Corp (ASX: WBC) shares are a popular option for income investors.

And it isn’t hard to see why.

Each year the banking giant shares a good portion of its profits with its shareholders in the form of dividends.

This often leads to above-average dividend yields from the shares of Australia’s oldest bank.

But with its shares up 23% over the last six months and trading not too far from a 52-week high, most analysts now believe they are fully valued.

In light of this, income investors may want to look at alternatives to Westpac shares.

But which ASX income stocks could be good options? Let’s take a look at three. They are as follows:

Eagers Automotive Ltd (ASX: APE)

The first option to consider buying is Eagers Automotive. It operates one of Australia’s largest auto dealership networks.

The team at Bell Potter is feeling positive about the company and sees recent weakness as a buying opportunity. The broker has a buy rating and $13.35 price target on its shares.

As for income, it expects the company to pay fully franked dividends of 64.5 cents per share in FY 2024 and then 73 cents per share in FY 2025. Based on its current share price of $10.14, this represents dividend yields of 6.35% and 7.2%, respectively.

Inghams Group Ltd (ASX: ING)

Morgans thinks that Inghams could be an ASX income stock to buy. It is Australia’s leading poultry producer and supplier.

It feels that its shares are undervalued based on its market leadership position and favourable consumer trends. The broker has an add rating and $4.40 price target on its shares.

As well as plenty of upside, Morgans is expecting some generous dividend yields. It has pencilled in fully franked dividends of 22 cents per share in FY 2024 and then 23 cents per share in FY 2025. Based on the current Inghams share price of $3.63, this equates to dividend yields of 6.1% and 6.3%, respectively.

IPH Ltd (ASX: IPH)

Finally, another alternative to Westpac shares could be IPH. It is a leading intellectual property solutions company with operations across the globe.

Goldman Sachs is a big fan of the company and believes it is “well-placed to deliver consistent and defensive earnings with modest overall organic growth.” It has a buy rating and $8.70 price target on its shares.

In respect to dividends, the broker is forecasting fully franked dividends of 34 cents per share in FY 2024 and then 37 cents per share in FY 2025. Based on the current IPH share price of $6.54, this represents yields of 5.2% and 5.7%, respectively.

The post Forget Westpac shares and buy these ASX income stocks appeared first on The Motley Fool Australia.

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• Insiders are buying these 6 ASX All Ords shares

Motley Fool contributor James Mickleboro has positions in Westpac Banking Corporation. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has recommended Eagers Automotive Ltd and IPH. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.