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If you are an income investor and are looking for dividend stocks to buy, you may want to take a look at the two listed below.
The team at Morgans recommended buying both. Here’s what they say about the ASX 200 dividend stock:
QBE Insurance Group Limited (ASX: QBE)
Morgans believes the shares of this insurance giant are in buy territory at the current level. This is because they trade in very attractive multiples at a time when the QBE outlook is improving.
He said, “We see QBE potentially having positive fundamental momentum in the coming year. QBE increased the top streak rate by about 9%, which should help margin expansion in FY22. With the recent QBE balance sheet reset, the The pricing tailwind is clear and stock trading is relatively inexpensive at about 12.8 times in FY 22F PE [now ~14x]. “
Morgans expects QBE to pay a dividend of 64.8 cents per share in fiscal 2022. Based on QBE’s current share price of $12.19, this would mean a return of 5.3%. The broker has an additional rating and a target price of $13.70 on its shares.
Westpac Banking Corporation (ASX: WBC)
Another share of the ASX 200 earnings that Morgans loves is Westpac. It believes that the banking giant’s shares are cheap at the current level and expects it to provide a generous return to investors.
Morgans commented: “WBC shares were sold so heavily after the announcement of the FY21 results that, of the major banks, WBC now trades on the lowest FY22F P/NTA multiplier, FY22F lowest dividend payout and highest FY22F dividend. These complications or returns can only be justified if the WBC is a value trap, which we believe is not.”
The broker anticipates an entirely outright dividend per share of $1.23 in FY 2022 and then $1.62 in FY 2023. Based on Westpac’s current share price of $21.75, this would mean returns of 5.7% and 7.45%, respectively. Morgans has an additional rating and a $29.50 target price on the bank’s stock.