Metcash Ltd (ASX: MTS) shares have been out of form over the last 12 months.
During this time, the ASX stock has lost approximately 8% of its value.
As a comparison, the ASX 200 index has charged 5.5% higher over the same period.
While this is disappointing for shareholders, it could be a buying opportunity for investors looking for a source of income.
That's because the decline in the Metcash share price means that its forecast dividend yield is now comfortably higher than the market average.
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What are analysts forecasting for this ASX stock?
According to a note out of UBS last month, its analysts have responded to the company's plan to acquire Superior Foods by retaining its buy rating with a $4.00 price target.
Based on the current Metcash share price of $3.70, this implies potential upside of 8.1% for investors over the next 12 months.
But it gets better. The broker is forecasting fully franked dividends per share of 20 cents in both FY 2024 and FY 2025. This equates to generous dividend yields of 5.4% for both years and stretches the total potential 12-month return to approximately 13.5%.
Is anyone else bullish?
UBS isn't alone with its positive stance on this ASX stock.
The team at Ord Minnett has an accumulate rating and $4.00 price target on Metcash's shares as well.
And with the broker also expecting a 20 cents per share fully franked dividend this year, it is predicting a 13.5% total return for investors.
All in all, these brokers appears to believe that Metcash could be an ASX 200 stock to consider buying if you're on the lookout for a nice combination of capital gains and income.
