Morgans names the ASX 200 dividend shares to buy

If you’re looking for dividend options, then you may want to check out the two that Morgans rates as buys.

Here’s what the broker is saying about these ASX 200 dividend shares right now:

QBE Insurance Group Ltd (ASX: QBE)

The first ASX 200 dividend share that has been tipped as a buy by the broker is insurance giant QBE. Morgans currently has an add rating and $14.93 price target on its shares.

Its analysts are very positive on the company due to rising premiums and cost reductions. They commented:

With strong rate increases still flowing through QBE’s insurance book, and further cost-out benefits to come, we expect QBE’s earnings profile to improve strongly over the next few years. The stock also has a robust balance sheet and remains relatively inexpensive overall trading on ~9.1x FY23F PE

Morgans expects this to lead to a 41.5 cents per share dividend in FY 2022 and then a 76.5 cents per share dividend in FY 2023. Based on the latest QBE share price of $12.01, this equates to yields of 3.45% and 6.4%, respectively.

South32 Ltd (ASX: S32)

Another ASX 200 dividend share that Morgans is positive on is mining giant South32. It currently has an add rating and $5.30 price target on the company’s shares.

Morgans is a fan of the company due to its portfolio transformation and favourable dividend policy. It commented:

S32 has transformed its portfolio by divesting South African thermal coal and acquiring an interest in Chile copper, substantially boosting group earnings quality, as well as S32’s risk and ESG profile. Unlike its peers amongst ASX listed large-cap miners, S32 is not exposed to iron ore. Instead offering a highly diversified portfolio of base metals and metallurgical coal (with most of these metals enjoying solid price strength). We see attractive long-term value potential in S32 from de-risking of its growth portfolio, the potential for further portfolio changes, and an earnings-linked dividend policy.

As for dividends, the broker is expecting fully franked dividends per share of 22.7 cents in FY 2023 and 21.2 cents in FY 2024. Based on the current South32 share price of $3.60, this will mean yields of 6.3% and 5.9%, respectively.

The post Morgans names the ASX 200 dividend shares to buy appeared first on The Motley Fool Australia.

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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 no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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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