There are a lot of ASX dividend shares for income investors to choose from on the Australian share market. So many, it can be hard to decide which ones to buy over others.
But don't worry, because I have narrowed things down by looking at two shares that brokers are tipping as buys right now.
These shares are expected to provide investors with dividend yields greater than 5% and have potential upside in excess of 15%. Here's what analysts are expecting from these dividend shares in the near term:
The team at UBS is tipping Origin Energy as an ASX dividend share to buy this month. It is of course one of Australia's leading providers of electricity, gas, LPG, solar and internet to homes and businesses across Australia.
UBS currently has a buy rating and $11.90 price target on its shares. This implies potential upside of almost 18% for investors over the next 12 months.
The broker was pleased with Origin Energy's recent second quarter update and believes that it is well-placed to pay some big dividends in the near term. This is thanks partly to the key APLNG business and the strong performance from the Octopus business.
It is forecasting fully franked dividends per share of 55 cents in both FY 2025 and FY 2026. Based on its current share price of $10.12, this would mean dividend yields of 5.4% for each year.
Over at Goldman Sachs, its analysts think that Rio Tinto could be an ASX dividend share to buy.
The broker recently put a buy rating and $146.20 price target on the mining giant's shares. Based on its current share price of $119.32, this suggests that upside of 22.5% is possible for investors over the next 12 months.
Goldman believes that the mining giant has an attractive relative valuation, free cash flow, and dividend yield. This is being underpinned partly by its exposure to copper and aluminium.
The broker notes that Rio Tinto has an "FCF/dividend yield in 2025E (c. 5%/5% yield) & 2026E (c. 7%/6% yield) driven by our bullish view on aluminium and copper (~45-50% of group EBITDA by 2026E)."
Goldman Sachs is forecasting fully franked dividends of US$4.08 (A$6.50) per share in FY 2025 and FY 2026. Based on the current Rio Tinto share price, this would mean yields of 5.4% for both years.
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