Analysts say Telstra and this ASX 200 dividend share are top buys

MotleyFool
2024-10-29

Thankfully for income investors, there are lots of ASX 200 dividend shares to choose from on the local share market.

But which ones could be buys this week? Let's look at two that analysts currently rate as buys. They are as follows:

Telstra Group Ltd (ASX: TLS)

The first ASX 200 dividend share that could be a buy is telco giant Telstra. Goldman Sachs thinks that Telstra could be a great option for income investors right now.

It was pleased with the company's performance in FY 2024 and expects more of the same in the new financial year. This is expected to be underpinned by Telstra's key mobile business. Goldman said:

We believe the low risk earnings (and dividend) growth that Telstra is delivering across FY22-25, underpinned through its mobile business, is attractive. We also believe that Telstra has a meaningful medium term opportunity to crystallise value through commencing the process to monetize its InfraCo Fixed assets – which we estimate could be worth between A$22-33bn.

Goldman is forecasting fully franked dividends of 19 cents per share in FY 2025 and then 20 cents per share in FY 2026. Based on the current Telstra share price of $3.87, this represents dividend yields of 4.9% and 5.15%, respectively.

The broker currently has a buy rating and $4.35 price target on Telstra's shares.

Transurban Group (ASX: TCL)

Another ASX 200 dividend share that could be a buy right now according to analysts at Bell Potter is Transurban. It is one of the world's leading toll road operators with a high-quality portfolio of assets across Australia and North America.

In addition, the company has a significant growth pipeline, which the team at Bell Potter believes will drive long term growth. The broker recently 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.

Bell Potter believes Transurban will pay dividends per share of 65 cents in FY 2025 and 72 cents in FY 2026. Based on its current share price of $13.01, this will mean yields of 5% and 5.5%, respectively.

The broker currently has a buy rating and $14.20 price target on Transurban's shares.

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