Those who own shares in S&P/ASX 200 Index (ASX: XJO) supermarket operator Coles Group Ltd (ASX: COL) could be in for a good few years, with one top broker tipping the company to pay out 23% more dividends in financial year 2023 than it did in financial year 2021.
The broker is also feeling hopeful about the stock’s final dividend of financial year 2022, to be announced later this month.
The Coles share price is currently $18.81, 0.53% higher than its previous close.
For context, the ASX 200 is trading slightly lower today, falling 0.24%.
Let’s take a closer look at why Citi is bullish on Coles and its dividends.
Could Coles shares pay 75 cents of dividend in FY23?
Coles emerged as an ASX dividend share in 2018 shortly after the company was spun-out from Wesfarmers Ltd (ASX: WES). Here’s how its fully fully-franked dividends have grown over the years:
- Financial year 2019 saw Coles offer 35.5 cents per share
- That increased to 57.5 cents per share for financial year 2020
- It was upped once more to reach 61 cents per share for financial year 2021
And it’s been tipped to continue growing its dividends into the future, as my Fool colleague James reports.
Citi believes Coles will pay out 65 cents per share for last financial year. Meaning, Coles’ next final dividend is expected to come in at 32 cents.
The broker also tips the company to offer shareholders 75 cents per share in financial year 2023 â a whopping 22.95% more than its most recent full year payout.
Whether the broker’s expectations are realised will be revealed soon. The supermarket operator is set to release its full-year earnings for financial year 2022 â alongside the details of its next dividend â on 24 August.
The broker has also slapped Coles shares with a $21 price target and a buy rating. That represents a potential 12% upside on its current level.
The post Top broker tips Coles shares to pay 23% more dividends in FY23 appeared first on The Motley Fool Australia.
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More reading
- ASX 200 better buy: Wesfarmers or Woolworths?
- Brokers name 2 ASX dividend shares to buy
- 2 little-to-no-debt ASX 200 shares to buy in a downturn: fundie
- Is Coles an underrated ASX 200 dividend share with potential?
- Top brokers name 3 ASX shares to buy next week
Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. 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 positions in and has recommended COLESGROUP DEF SET and Wesfarmers Limited. 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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