Income investors are spoiled for choice when it comes to ASX dividend shares in the local market.
To keep things brief, let’s take a look at two that have been named buys by brokers.
Here’s what they’re recommending to customers:
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Collins Foods Limited (ASX:CKF)
Morgans is a fan of this quick service restaurant operator and is pleased with its performance in tough operating environments.
Commenting on its recent results, the broker said:
In our view, CKF reported a solid result in light of the difficult circumstances. NPAT That was a 17.6% increase at the midpoint of guidance. COGS is expected to be flat to modest in FY27, which is better than expected. KFC Australia 1H27-to-date SSS +4.0% is off to a stronger than expected start. Europe disappointed with initial 1H27 SSS tracking, which was overwhelmingly negative, although this was attributable to factors beyond CKF’s control. The balance sheet remains strong with an ND/EBITDA of 0.8x, leaving CKF well positioned to fund German expansion, accelerate quench rollouts and pursue further German bolt-on acquisitions.
Although the structure of our forecasts has changed, the impact on net profit is modest. We believe CKF is undervalued given its growth profile. Despite the difficult consumer environment, CKF has proven resilient and is delivering solid growth despite many challenges. We maintain our buy recommendation and revise our price target to A$10.60 from A$12.50.
Morgan is forecasting a fully franked dividend of 31 cents per share in fiscal 2027 and 35 cents in fiscal 2028. Based on the current share price of $7.95, this would mean dividend yield About 4% and 4.4% respectively.
The broker has a buy rating and a $10.60 price target on the company’s shares.
Harvey Norman Holdings Limited (ASX:HVN)
Another ASX dividend stock that brokers are bullish on is retail giant Harvey Norman.
Bell Potter expects fiscal 2027 to be a tough year, but believes this is more than worth the price. And with expectations of generous yields, he sees now as a good time to buy Harvey Norman shares. It said:
While our views on FY27e see challenging conditions for retailers with a recovery weighting of 2H, HVN on our revised estimates continues to trade at a 1-year Forward P/E of ~13x (as per BPe) which appears attractive.
We see mid- to long-term growth catalysts related to new store driven growth in international retail sales (UK, Malaysia, Croatia), refit programs in Australia, expansion of brand partnerships in the midpremium end of the Whitegoods market, which mitigates risk in the mid-market segment somewhat and provides opportunities to grow its real estate portfolio as Australia’s largest owner in large format retail with a global portfolio of ~$4.6b. We maintain buy.
Bell Potter is forecasting a fully franked dividend of 31.1 cents per share in fiscal 2027 and then 33.3 cents per share in fiscal 2028. Based on the current share price of $4.75, this equates to dividend yields of 6.6% and 7% respectively.
The broker currently has a buy rating and a $6.00 price target on its shares.