Brokers rate these ASX dividend shares as buys

Looking for dividend shares to buy? Then read on! Listed below are two ASX dividend shares that brokers rate as buys.

Here’s why they are bullish on these dividend shares:

Adairs Ltd (ASX: ADH)

Goldman Sachs is a fan of this furniture and homewares retailer. It believes the company is well-placed for growth thanks to its highly loyal customer base, strong social media presence, and ongoing store roll-out opportunity.

The broker has just initiated coverage on Adairs’ shares with a buy rating and $3.05 price target. It commented:

The core Adairs business has a highly loyal customer base, and ongoing store roll-out opportunity: ADH is has a strong brand presence across Australia, a highly engaged and loyal customer base (>1mn Linen Lover members), and ongoing opportunity to roll out new and upsized stores (targeting 5% GLA p.a.). ADH has among the largest social media presences of its peers, which we believe the business can leverage to drive ongoing sales growth.

As for dividends, Goldman is forecasting fully franked dividends per share of 18 cents in FY 2023 and 20 cents in FY 2024. Based on the latest Adairs share price of $2.08, this will mean huge yields of 8.6% and 9.6%, respectively.

Wesfarmers Ltd (ASX: WES)

Analysts at Morgans are positive on this conglomerate. They like the company due to its strong brands and highly regarded management team. The broker also highlights that the key Bunnings business continues to perform strongly.

Morgans has an add rating and $55.60 price target on the company’s shares. It commented:

WES possesses one of the highest quality retail portfolios in Australia with strong brands including Bunnings, Kmart and Wesfarmers Consumer Officeworks. The company is run by a highly regarded management team and the balance sheet is healthy. While COVID-related staff shortages are proving to be a challenge, the core Bunnings division (>60% of group EBIT) remains a solid performer as consumers continue to invest in their homes. We see the pullback in the share price as a good entry point for longer term investors.

In respect to dividends, Morgans is expecting fully franked dividend per share of $1.82 in FY 2023 and $1.89 in FY 2024. Based on the current Wesfarmers share price of $47.28, this will mean yields of 3.8% and 4%, respectively.

The post Brokers rate these ASX dividend shares as buys appeared first on The Motley Fool Australia.

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More reading

• Brokers name 3 ASX shares to buy today
• Buying Wesfarmers shares? Here’s why the company says Bunnings can continue to outperform
• Could these ‘little’ businesses be a secret weapon for Wesfarmers shares?
• Are ‘cracks starting to show’ for ASX 200 retail shares?
• Should all ASX investors be buying defensive shares right now?

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 ADAIRS FPO. The Motley Fool Australia has positions in and has recommended ADAIRS FPO 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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