Brokers name 2 ASX dividend shares to buy now

Are you looking for dividend shares to buy? If you are, then the two named below could be worth checking out.

Both have been named as buys by brokers and tipped to provide investors with attractive yields. Here’s what you need to know about them:

Coles Group Ltd (ASX: COL)

The first ASX dividend share that could be in the buy zone is Coles.

The team at Morgans is positive on the supermarket giant and has put an add rating and $19.50 price target on its shares.

The broker feels that Coles’ shares are trading at an attractive level given its defensive characteristics in this uncertain economic environment. It also believes that a reversion in shopping habits since the pandemic will be a positive for Coles. The broker explained:

Trading on 20.6x FY23F PE and 4.0% yield, we continue to see COL as offering good value with the company’s solid balance sheet and defensive characteristics putting it in a good position to navigate through a weaker economic environment. The unwinding of local shopping should also help further market share gains.

In respect to dividends, Morgans expects a fully franked dividend of 64 cents per share in FY 2023 and a fully franked dividend of 66 cents per share in FY 2024. Based on the current Coles share price of $16.52, this will mean yields of 3.9% and 4%, respectively.

Universal Store Holdings Ltd (ASX: UNI)

Another ASX dividend share that has been tipped as a buy is Universal Store.

It is a growing retailer focused on youth fashion through the Universal Store and Thrills brands.

Goldman Sachs notes that the company’s shares have fallen heavily over the last 12 months amid weakness in the retail sector. Its analysts believe this has created a buying opportunity for investors due to the company’s exposure to younger consumers and its expansion options. The broker commented:

In addition to a strong outlook for Gen-Z spending, we see an opportunity for ongoing store roll-out for UNI which is the market leader in youth multi-brand apparel. Relative to youth footwear, the youth apparel category is under-penetrated in terms of store footprint; we forecast an additional 22 Universal stores will be rolled out in the next three years.

Goldman Sachs has a buy rating and $7.30 price target on its shares.

As for dividends, the broker is expecting fully franked dividends of 26.1 cents in FY 2023 and 29.9 cents in FY 2024. Based on the latest Universal Store share price of $5.14, this equates to yields of 5.1% and 5.8%, respectively.

The post Brokers name 2 ASX dividend shares to buy now 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 positions in and has recommended Coles Group. 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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