Morgans names the best ASX 200 dividend shares to buy in April

Morgans believes that these ASX dividend shares tick a lot of boxes for income investors.

| More on:
a woman holds a facebook like thumbs up sign high above her head. She has a very happy smile on her face.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The good news for income investors is that there are a large number of quality ASX 200 dividend shares to choose from on the Australian share market.

Two that have been tipped as best buys by analysts at Morgans in April are listed below. Here's what the broker is saying about them:

Santos Ltd (ASX: STO)

The first ASX 200 dividend share that Morgans has on its best ideas list is energy producer Santos. The broker currently has an add rating and $8.60 price target on its shares.

It believes Santos is a great option due to its growth potential and diversified earnings. The broker explained:

The resilience of STO's growth profile and diversified earnings base see it well placed to outperform against the backdrop of a broader sector recovery. While pre-FEED, we see Dorado as likely to provide attractive growth for STO, while its recent acquisition increasing its stake in Darwin LNG has increased our confidence in Barossa's development.

Morgans is expecting this to underpin dividends per share of 28.4 US cents in FY 2023 and 29.9 US cents in FY 2024. Based on the current Santos share price of $7.18, this will mean yields of 5.8% and 6.15%, respectively.

Westpac Banking Corp (ASX: WBC)

Another ASX 200 dividend share that Morgans has on its best ideas list this month is Australia's oldest bank, Westpac. It has an add rating and $25.80 price target on its shares.

Morgans feels that Westpac is well-placed to deliver the best return on equity improvement in the sector and appears to believe this could underpin some big dividends in the coming years. It commented:

We view WBC as having the greatest potential for return on equity improvement amongst the major banks if its business transformation initiatives prove successful. The sources of this improvement include improved loan origination and processing capability, cost reductions (including from divestments and cost-out), rapid leverage to higher rates environment, and reduced regulatory credit risk intensity of non-home loan book. Yield including franking is attractive for income-oriented investors, while the ROE improvement should deliver share price growth.

The broker is forecasting fully franked dividends per share of $1.53 per share in FY 2023 and $1.59 per share in FY 2024. Based on the current Westpac share price of $21.74, this will mean yields of 7% and 7.3%, respectively.

Motley Fool contributor James Mickleboro has positions in Westpac Banking. 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 Westpac Banking. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Dividend Investing

A businesswoman on the phone is shocked as she looks at her watch, she's running out of time.
Dividend Investing

Want to bag the upcoming Macquarie dividend? You better hurry!

Here’s what you need to know.

Read more »

Hand holding Australian dollar (AUD) bills, symbolising ex dividend day. Passive income.
Dividend Investing

4 ASX All Ords shares with ex-dividend dates next week

Pay close attention to these dates.

Read more »

Two workers at an oil rig discuss operations.
Dividend Investing

This high-yielding ASX 200 dividend stock remains a top choice for passive income

I think this ASX 200 dividend gem will remain a top passive income stock for years to come.

Read more »

Person handing out $50 notes, symbolising ex-dividend date.
Dividend Investing

Buy these ASX dividend shares for 6%+ yields

Analysts expect these stocks to provide income investors with big yields in the coming years.

Read more »

Beautiful young couple enjoying in shopping, symbolising passive income.
Dividend Investing

2 high-yield Australian dividend shares for reliable passive income

When you're looking to generate passive income from the share market, you want reliability. No income investor wants to see…

Read more »

Happy female friends taking self portrait through mobile phone at pool's edge, symbolising passive income.
Dividend Investing

Looking for passive income? Try this ASX 200 blue chip

This stock's 4.66% fully franked yield is hard to ignore.

Read more »

Man holding out Australian dollar notes, symbolising dividends.
Bank Shares

Everything you need to know about the NAB dividend

NAB will soon be sending its next payout to investors.

Read more »

Happy man holding Australian dollar notes, representing dividends.
Dividend Investing

2 high-yield ASX dividend shares for Australian retirees

Analysts are tipping big yields and big returns from these income stocks.

Read more »