If you're wanting to generate passive income from the share market, then the ASX dividend shares listed below could be good options.
They have been rated as buys by analysts and tipped to provide investors with great dividend yields. Here's what you need to know about them:
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QBE Insurance Group Ltd (ASX: QBE)
Analysts at Goldman Sachs are feeling very positive about this insurance giant and see it as an ASX dividend share to buy this month.
The broker has named five reasons why it thinks investors should be buying QBE's shares. This includes its exposure to the commercial rate cycle and its improving performance in North America. It said:
QBE is a global commercial insurer with three main geographical operations across Australia Pacific, International (encompassing Europe) and North America. We are Buy-rated on QBE because 1) QBE has the strongest exposure to the commercial rate cycle. 2) QBE's achieved rate increases continue to be strong & ahead of loss cost inflation. 3) North America on a pathway to improved profitability. 4) Valuation not demanding. 5) Strong ROE.
As for passive income, Goldman is forecasting dividends per share of 60 US cents (89 Australian cents) in FY 2024 and 63 US cents (93.5 Australian cents) in FY 2025. Based on the current QBE share price of $16.93, this equates to dividend yields of 5.25% and 5.5%, respectively.
Its analysts also see plenty of upside for investors. They have a buy rating and $20.60 price target on its shares.
Transurban Group (ASX: TCL)
Another ASX dividend share that could be a good option for passive income investors is Transurban. It manages and develops urban toll road networks in Australia and North America.
Bell Potter likes the company. This is due to its development pipeline, positive exposure to inflation, and low risk cashflows. It said:
We believe the current inflationary environment is favourable for Transurban given its inflation-linked revenue stream with annual escalators. Moreover, TCL provides low risk cash flows over the long term, with long concession duration (30+ years), and relative traffic/income resilience. The group's current pipeline of growth projects is $3.3 billion (TCL's share of total project cost) and further huge development opportunities are expected over the next few decades, supported by population and economic growth.
In respect to passive income, Bell Potter is forecasting dividends per share of 63.6 cents in FY 2024 and then 65.1 cents in FY 2025. Based on the current Transurban share price of $12.43, this will mean dividend yields of 5.1% and 5.2%, respectively.
The broker has a buy rating and $15.50 price target on its shares.
