Fortunately in this low interest rate environment, the ASX is home to a number of shares that are expected to provide attractive yields to investors in 2021.
If you’re interested in blue chip dividend shares, then you may want to look at the ones listed below. Here’s why they could be dividend shares to buy:
Australia and New Zealand Banking GrpLtd (ASX: ANZ)
The first blue chip ASX dividend share to look at is ANZ Bank. Thanks to mortgage loan growth, a reduction in COVID-19 loan deferrals, and the relaxing of responsible lending rules, this banking giant’s outlook has improved greatly over the last six months.
And while this has been reflected in its strong share price gain (the ANZ share price is up ~44% in six months), it may not be too late to make an investment.
Last week Morgans put an add rating and $28.50 price target on the bank’s shares. It is also forecasting ANZ to pay shareholders a dividend of $1.27 per share in FY 2021. Based on the latest ANZ share price, this represents a 5% dividend yield.
Woolworths Limited (ASX: WOW)
Another option for investors to consider is Woolworths. It could be a good option for income investors due to the quality of the retail giant’s numerous brands. While best known for its eponymous supermarkets, Woolworths also owns Dan Murphy’s, BWS, and BIG W.
As a whole, the company appears to be well-positioned for growth over the long term thanks to its defensive qualities, strong market position, and a favourable redirection in consumer spending.
Analysts at Macquarie are positive on the company. They have just retained their outperform rating and lifted the price target on the company’s shares to $44.50. Macquarie is also forecasting a $1.01 per share fully franked dividend in FY 2021. Based on the latest Woolworths share price, the equates to a 2.5% dividend yield.
While this is not the most generous yield you will find, it is still materially better than savings accounts and term deposits.
Where to invest $1,000 right now
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Woolworths Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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