Commonwealth Bank of Australia (ASX: CBA) shares are a popular option for income investors.
But with many analysts saying that the banking giant’s shares are overvalued at current levels, it may not be the best pick right now.
But which ASX dividend stocks could be good alternatives? Let’s take a look at three:
Challenger Ltd (ASX: CGF)
This annuities company could be an ASX dividend stock to buy right now according to analysts at Goldman Sachs.
The broker likes Challenger due to its “exposure to the growing superannuation market” and its belief that “higher yields should drive a favorable sales environment for retail annuities.”
In respect to income, Goldman is forecasting fully franked dividends of 26 cents per share in FY 2024 and then 27 cents per share in FY 2025. Based on the current Challenger share price of $6.82, this will mean dividend yields of 3.8% and 4%, respectively.
Goldman currently has a buy rating and $7.50 price target on its shares.
Healthco Healthcare and Wellness REITÂ (ASX: HCW)
Another ASX dividend stock that could be a good option for income investors is the Healthco Healthcare and Wellness REIT.
It is a real estate investment trust with a focus on healthcare and wellness assets. This includes hospitals, aged care, childcare, government, life sciences and research, and primary care and wellness properties.
Morgans is very positive on the company and believes it is well-placed to pay dividends per share of 8 cents in FY 2024 and then 8.3 cents FY 2025. Based on the current Healthco Healthcare and Wellness REIT unit price of $1.08, this will mean yields of 7.4% and 7.7%, respectively.
Morgans has an add rating and $1.50 price target on its shares.
Telstra Group Ltd (ASX: TLS)
Analysts at Goldman Sachs also think that income investors should buy Telstra shares.
It continues to see a lot of value in the telco giant at current levels. Particularly given its low risk growth.
In addition, it is expecting some good yields from its shares. The broker is forecasting fully franked dividends of 18 cents per share in FY 2024 and then 18.5 cents per share in FY 2025. Based on the current Telstra share price of $3.70, this equates to yields of 4.9% and 5%, respectively.
Goldman has a buy rating and $4.25 price target on the ASX dividend stock.
The post Forget CBA and buy these ASX dividend stocks appeared first on The Motley Fool Australia.
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More reading
- ASX 200 bank shares ‘don’t appear overly expensive’ compared to global peers: UBS
- Down 16% over 12 months, the Telstra share price could explode 20% from here!
- 3 top ASX retirement shares to buy for FY25
- Buy Woolworths and these ASX dividend stocks
- How come the Telstra share price crashed 16% in FY 2024?
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 Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool Australia has recommended Challenger. 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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