The Australian share market presents a robust opportunity for generating passive income through dividends. Many ASX-listed companies distribute a portion of their profits to shareholders annually, and for those with growing profits, these dividends often increase over time. Long-term investors can potentially benefit from substantial dividend income by investing in companies with a consistent history of dividend growth.
Here are two ASX dividend-growth stocks currently highlighted for their potential long-term benefits:
APA Group (ASX: APA) APA Group is a significant player in the energy infrastructure sector, managing a diverse portfolio valued at $27 billion. This portfolio includes assets such as electricity transmission, gas distribution, solar and wind farms, and battery storage facilities.
APA Group has demonstrated a commendable track record, increasing its dividend payouts every year for nearly two decades. This consistent growth is expected to continue, with forecasts suggesting dividends per share of 56 cents for FY 2024 and 57.5 cents for FY 2025. With the current share price at $7.91, these projections yield approximately 7.1% for FY 2024 and 7.3% for FY 2025. This long-standing history of dividend increases underscores APA’s commitment to delivering value to its shareholders.
Lovisa Holdings Ltd (ASX: LOV) Lovisa Holdings Ltd, a prominent fast fashion jewellery retailer, operates over 850 stores across 30 countries. The company is poised for substantial global expansion, particularly into the US and European markets, which is expected to drive further growth in both earnings and dividends.
The company’s strong growth potential is supported by its strategic plans and financial capacity to fund expansion. Analysts anticipate that Lovisa will offer fully franked dividends of 80 cents per share for FY 2024, increasing to 86 cents per share in FY 2025. At the current share price of $34.94, these dividend forecasts translate to yields of 2.3% for FY 2024 and 2.45% for FY 2025. Lovisa's ongoing expansion and strategic growth initiatives position it well for continued dividend increases in the future.
APA Group and Lovisa Holdings Ltd are highlighted as notable ASX dividend-growth stocks, offering appealing prospects for long-term investors. APA’s impressive track record of consistent dividend increases and Lovisa’s potential for substantial global expansion make these companies strong candidates for those seeking to build a dividend-focused investment portfolio. As always, investors should conduct thorough research and consider their own financial goals when evaluating investment opportunities.