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Top brokers name 3 ASX dividend shares to buy

The Motley Fool logo The Motley Fool 24/05/2020 05:01:49 James Mickleboro
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When it comes to dividend shares there are countless options for investors to choose from on the ASX. Which certainly is fortunate with rates going down to record lows.

But with so many to choose from, it can be hard to decide which ones to buy.

To narrow things down I have picked out three dividend shares that brokers think investors should buy:

Aventus Group (ASX: AVN)

According to a note out of Goldman Sachs, its analysts have upgraded this retail property company's shares to a buy rating with a $2.46 price target. The broker believes Aventus is well positioned to prosper as Australia gradually re-opens. This is due to its large format retail portfolio being weighted towards everyday needs and homewares, electrical, furniture, bedding and hardware. Everyday needs account for 38% of rental income, whereas the others make up the balance. In light of this, it has forecast Aventus paying a ~17.3 cents per unit distribution in FY 2021. This equates to a forward ~8.7% distribution yield.

Rio Tinto Limited (ASX: RIO)

Analysts at Morgans have retained their add rating and lifted the price target on this mining giant's shares to $105.00. According to the note, the broker believes iron ore prices could surge higher from here due to supply disruptions. It doesn't believe this is being reflected in its share price. In addition to this, the broker believes Rio Tinto will return significant funds back to shareholders again through dividends. So much so, it estimates that its shares are offering a fully franked ~9% FY 2021 dividend yield at present.

Service Stream Limited (ASX: SSM)

A note out of the Macquarie equities desk reveals that its analysts have retained their outperform rating but trimmed the price target on this essential network services company's shares to $2.88. According to the note, the broker wasn't overly surprised that Service Stream's guidance for FY 2020 fell short of its estimates. It believes these delays were caused by clients not wanting to disrupt connections in both utility and telecommunications while people work from home. Macquarie expects this to be a temporary headwind and remains upbeat on the future. It is forecasting a fully franked dividend of 8.4 cents per share in FY 2021. This means a yield of almost 4.2%.

And here is a fourth buy-rated dividend share which continues to grow even during the pandemic.

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Edward has just named what he believes is the number one ASX dividend stock to buy for 2020.

This fully franked "under the radar" company is currently trading more than 24% below its all-time high and paying a 6.7% grossed-up dividend.

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But you will have to hurry - history has shown it can pay dividends to get in early to some of Edward's stock picks, and this dividend stock is already on the move.

See the top dividend stock for 2020

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended AVENTUS RE UNIT and Service Stream Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Top brokers name 3 ASX dividend shares to buy appeared first on Motley Fool Australia.

24. toukokuuta 2020 8:01:49 Categories: The Motley Fool USA TODAY

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