If you're building an income portfolio, then you may want to look at the buy-rated dividend shares listed below.
Here's why these ASX dividend shares could be worth considering right now:
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Adairs Ltd (ASX: ADH)
The first ASX dividend share to look at is Adairs. This leading retailer of homewares and home furnishings could be a good option due to its strong market position, growing online businesses, and generous yield.
In respect to the former, the company's strong market position allowed it to take full advantage of favourable trading conditions in FY 2021. This led to the company reporting a 28.5% increase in sales to $499.8 million and the almost doubling of its EBIT to $109.1 million.
This went down well with analysts at Morgans. In response, the broker put an add rating and $4.20 price target on the company's shares.
Looking ahead, Morgans is confident in its medium term outlook and is forecasting dividends per share of 22 cents in FY 2022 and 27 cents in FY 2023. Based on the current Adairs share price of $3.86, this will mean yields of 5.7% and 7%, respectively.
Telstra Corporation Ltd (ASX: TLS)
Another ASX dividend share to consider is Telstra. After several years of struggles, this telco giant is now on the path to growth again. This was confirmed last week when the company released its T25 update. This is Telstra's new strategy that will build on the highly successful T22 strategy from next year.
Telstra revealed that it will aim for sustained growth and value by targeting mid-single digit underlying EBITDA and high-teen underlying earnings per share compound annual growth rates (CAGR) from FY 2021 to FY 2025.
This went down well with analysts at Goldman Sachs. The broker believes the strategy will support a return to dividend growth in the coming years.
Goldman is now forecasting 16 cents per share fully franked dividends through to FY 2023. After which, it expects a dividend of 18 cents per share in FY 2024 and then 19 cents per share in FY 2025.
Based on the current Telstra share price of $3.88, this will mean yields of 4.1%, 4.6%, and 4.9%, respectively.
Goldman has a buy rating and $4.40 price target on its shares.
