I love finding ASX dividend shares that offer investors great dividend yields. A yield of 7% or more is very appealing, even in this higher interest rate era.

I’d only want to buy businesses that can provide stable or growing payouts. If we’re aiming for passive income, I want to have confidence that those cash payments will continue flowing.

Of course, dividends are not guaranteed from any business. But, some companies already have a track record of reliable or increasing payouts. Let’s get into two great ideas.

Universal Store Holdings Ltd (ASX: UNI)

Universal Store is one of the leading retailers on the ASX, in my view, with how impressively it has managed to grow earnings over the last five years through all economic conditions.

It’s best known for its premium youth fashion-focused businesses Universal Store and Perfect Stranger.

Those two businesses have delivered pleasing growth at their existing store network, and they continue to expand. In the first 43 weeks of FY26, the company reported like-for-like sales growth of 8.5% for Universal Store and 12.9% for Perfect Stranger.

Partially thanks to four new Universal Stores and seven new Perfect Stranger stores in the year to date (at the point of that update), those two segments were able to report total sales growth of 11.8% and 39.8% respectively in the first 43 weeks of FY26.

It’s clearly doing a great job of winning more retail spending from customers, while also growing earnings. The mid-point of its FY26 guidance suggests overall sales could rise 11.5% year-over-year, while underlying operating profit (underlying EBITA) could rise 15.4% – faster than the sales growth.

Universal Store has increased its annual dividend per share each year since it started paying passive income in FY21. Its latest two dividends come to 42.5 cents per share, which translates into a grossed-up dividend yield of 8.3%, including franking credits.

Charter Hall Long WALE REIT (ASX: CLW)

The other ASX share I want to highlight with a yield of more than 7% is this real estate investment trust (REIT) that’s invested in an array of properties across Australia.

It’s invested in things like pubs, service stations, industrial and logistics, office, data centres and social infrastructure.

At December 2025, the business had 515 assets worth around $6 billion with an average weighted average lease expiry (WALE) of approximately nine years and an occupancy rate of 99.9%, with 99% of the portfolio leased to blue-chip tenants. That shows the business is maximising its rental potential for the long-term.

Pleasingly, the rental income continues to grow, which can help fund larger distributions in the coming years. Around half of the portfolio has CPI-linked rental growth, while fixed increases provide rental growth for the rest of the properties.

In the first half of FY26, the business achieved like-for-like rental growth of 3%, which helped fund a 2% rise in the distribution to 25.5 cents per security. At the time of writing, the attractive valuation offers a distribution yield of 7.02%.

I think these ASX shares would make excellent investments today.

The post 2 ASX dividend shares with yields above 7% appeared first on The Motley Fool Australia.

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• How much do I need in my superannuation to earn an annual $60,000 passive income?
• 2 ASX blue-chip shares offering big dividend yields
• How much passive income can I earn off a $50,000 portfolio?
• How to build a successful ASX dividend portfolio
• How much could a $500,000 ASX share portfolio pay in dividends?

Motley Fool contributor Tristan Harrison 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 recommended Universal Store. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The team at Morgans has been busy this week updating its views on three of the biggest names on the Australian share market.

Does it rate them as buys, holds, or sells? Let’s find out what the broker is saying about them:

BHP Group Ltd (ASX: BHP)

Morgans was pleased with BHP’s performance during the fourth quarter, highlighting that its operational performance was better than it was expecting.

However, due to its valuation and concerns that the market is too optimistic on BHP’s copper prospects, Morgans only has a hold rating and $60.20 price target on its shares. It said:

A good end to FY26 for BHP, with an operational result largely in line with consensus and a touch ahead of our estimates in places. Normally a source of volatility, BHP’s coal operations posted decent consensus beats at both BMA and NSWEC. FY27 guidance looks steady versus our existing estimates, although consensus does look high on group copper. Best-in-breed global diversified miner in what remains a healthy upcycle for resources. We maintain our HOLD rating and A$60.20 target price.

Commonwealth Bank of Australia (ASX: CBA)

The broker has been looking at banking giant CBA ahead of its results next month. Unfortunately, it continues to think that its valuation is stretched and has retained its sell rating on CBA shares with a trimmed price target of $117.63. It commented:

We make updates to our forecasts ahead of the FY26 result in August. Net result is 1-2% downgrades to FY27-28F EPS. 12 month target price reduces 1% to $117.63. Sell retained, given stretched valuation metrics remain implied in the share price (c.26x PER, 3.7x PBV, 2.9% cash yield).

Rio Tinto Ltd (ASX: RIO)

Finally, Morgans was also pleased with Rio Tinto’s performance in the last quarter, noting that Pilbara iron ore shipments were stronger than expected and its copper cost guidance has been trimmed.

However, with Rio Tinto shares rising strongly over the past 12 months, the broker has retained its hold rating with a $163.00 price target. It explains:

RIO posted a healthy Q2 where it matters, with Pilbara shipments beating consensus (+2%), while we see the headline Simandou miss (-68% vs consensus) as a net positive: a slower Simandou ramp supports iron ore benchmarks, and each US$10/t on the benchmark is worth ~US$2.5bn of annual EBITDA to RIO’s far larger Pilbara business. The sting in the tail was Kennecott, with a late June converting furnace breach requiring a ~75-day full rebuild, hitting H2 refined copper and gold output (total copper including saleable matte unchanged).

Copper C1 guidance halved to US30-50c/lb, on strong by-prod prices, a material margin tailwind into the H2 result. Trading back close to where we see fair value, RIO remains one of the highest quality global exposures to a sector enjoying a multi-year upcycle (albeit not without its volatility). We maintain our HOLD rating, A$163.00 TP (was A$165.00).

The post Buy, hold, sell: BHP, CBA, and Rio Tinto shares appeared first on The Motley Fool Australia.

More reading

• How to make $50,000 of passive income from ASX shares like CBA
• Does Macquarie rate BHP shares a buy, hold or sell right now?
• 3 top ASX 200 shares I’d buy for a self-managed superannuation fund
• Should you buy Rio Tinto and these ASX shares?
• How much do I need in my superannuation to earn an annual $60,000 passive income?

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 recommended BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Vanguard offers plenty of exchange-traded funds (ETFs), which can make choosing between them harder than it first appears.

I think the best place to start is with what an investor wants the fund to achieve.

The three Vanguard ETFs below could each be strong buys for different reasons.

Vanguard Diversified High Growth Index ETF (ASX: VDHG)

Some investors want broad exposure without having to assemble and maintain a collection of shares or funds.

That is where this Vanguard ETF stands out. The VDHG ETF combines Australian shares, international shares, emerging markets, and a smaller allocation to defensive assets inside one investment. Vanguard also handles the rebalancing, so the portfolio does not gradually drift away from its intended structure.

I think that simplicity can be strong over a long holding period.

Investors can keep adding money without having to decide which country or asset class to allocate to next. They also avoid the temptation to keep changing the portfolio whenever one market becomes popular.

The fund still has a growth-focused structure, so its value can fall during weak share market periods. But for someone looking for an all-in-one investment that can sit at the centre of a long-term strategy, I think this ETF is a strong option.

Vanguard MSCI International Small Companies Index ETF (ASX: VISM)

Many global ETFs are dominated by businesses that investors already know.

The VISM ETF looks further down the market. It gives investors exposure to smaller companies across developed markets outside Australia. These businesses operate across a wide range of industries and can include companies serving local markets, specialist niches, and emerging areas of demand.

I like this approach because the world economy extends far beyond the largest technology companies and consumer brands.

Smaller businesses can have more room to expand from their current size, particularly when they find a strong position in a growing market. A broad ETF spreads the investment across many companies rather than relying on one small-cap idea working out.

The trade-off is greater volatility. Smaller companies can be more sensitive to borrowing costs, economic conditions, and changes in investor confidence.

I would consider the VISM ETF as a long-term addition alongside a broader international ETF, especially for investors whose global exposure is concentrated in the market’s biggest names.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

The third ETF is aimed more directly at income.

This Vanguard ETF invests in Australian companies selected for their higher dividend yields. That can appeal to retirees and other investors who want their portfolio to produce regular distributions.

Australian companies also have the potential to attach franking credits to their dividends, which may improve the after-tax outcome for eligible investors.

I think the appeal here goes beyond the headline payout. A well-built income strategy can reduce the need to sell shares whenever cash is required.

Investors should still pay attention to where the income comes from. The Australian market has a strong presence from banks and resources companies, and their dividends can rise or fall with profits and economic conditions.

The VHY ETF could therefore suit investors who want higher income and understand that distributions will not remain identical every year.

Foolish takeaway

I think the strongest ETF decisions begin with giving each fund a clear purpose.

One investor may value the convenience of having an entire portfolio managed inside a single ETF. Another may want to widen global exposure beyond the familiar market leaders, while an income investor may place greater weight on distributions.

These Vanguard ETFs cover each of those goals. The right choice will depend on the rest of the portfolio, the investor’s time horizon, and how much volatility they are prepared to accept. For long-term investors who understand what they are buying, I think these three ETFs could all be strong choices.

The post Why these Vanguard ETFs could be strong buys appeared first on The Motley Fool Australia.

More reading

• Own Vanguard ASX ETFs? It’s dividend payday!
• VAS vs. VHY: Which is the better ASX ETF for retirement?
• I’d buy these 5 ASX dividend investments for retirement income
• How Vanguard’s biggest ASX ETFs performed in FY26
• Why I think these Vanguard ETFs are perfect buy and hold investments

Motley Fool contributor Grace Alvino 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 recommended Vanguard Australian Shares High Yield ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.