Why NAB (ASX:NAB) and this ASX dividend share could be buys

These dividend shares could be buys…

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If you're currently building an income portfolio, then you might want to look at the shares listed below.

Here's why these ASX dividend shares could be worth considering right now:

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National Australia Bank Ltd (ASX: NAB)

The first ASX dividend share to look at is this banking giant. It could be a top option due to its improving performance, positive outlook, strong balance sheet, and proposed acquisition of Citi's Australian consumer business.

In respect to its improving performance, last month NAB released its third quarter update and revealed unaudited cash earnings of $1.70 billion. This was broadly in line with the quarterly average it achieved during the first half and well ahead of expectations.

Goldman Sachs has been pleased with NAB's performance and plans. So much so, it has a conviction buy rating and $30.62 price target on its shares.

In addition, Goldman is forecasting a fully franked $1.40 per share dividend in FY 2022. Based on the current NAB share price of $27.35, this will mean a yield of 5.1%.

Scentre Group (ASX: SCG)

Another ASX dividend share that Goldman Sachs rates highly is Scentre. It likes the shopping centre operator due to its strong market position and positive leverage to inflation.

Goldman estimates that 70%+ of Scentre's base rental income is subject to inflation-linked escalation, which bodes well in the current environment. The broker also highlights that higher inflation aids the profitability of its retailer tenancy base, which benefits from fixed cost leverage.

In light of this, the broker currently has a buy rating and $3.32 price target on the company's shares. This compares to the latest Scentre share price of $2.90.

Furthermore, based on its current share price, Goldman is forecasting dividend yields of approximately 5% in FY 2021 and 5.7% in FY 2022.

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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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