There are a number of S&P/ASX 200 Index (ASX: XJO) dividend shares that are known for paying large dividends. Investors may like to know about some of the ones that could offer both capital growth and dividend potential.
The dividend income from names like Commonwealth Bank of Australia (ASX: CBA) and BHP Group Ltd (ASX: BHP) can be large. But, given how big those companies are, it may be questionable how much bigger they can become.
However, there are a number of ASX 200 dividend shares that investors could build a portfolio around.
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Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
This is one of the largest investment companies in Australia. At more than a century old, it's one of the oldest on the ASX. It has paid a dividend every year in its listed existence. The company has also grown its dividend each year since 2000, which is the longest growth streak on the ASX.
Soul Pattinson has a diversified portfolio across a number of sectors, such as resources, telecommunications, property, building products, agriculture, financial services, industrials, and so on.
Commsec numbers suggest that the business could pay an annual ordinary dividend of 77 cents per share in FY23, which would be a grossed-up dividend yield of around 4%.
APA Group (ASX: APA)
APA Group owns a portfolio of gas pipelines around Australia, transporting half of the country's gas usage. It owns other gas-related energy infrastructure (including power generation and storage). The ASX 200 dividend share also owns a growing portfolio of renewable energy assets.
The business is seeing a steady rise in its distribution as its cash flow grows. It has grown its annual payout every year for more than a decade and a half. It's exploring the potential of being able to transport hydrogen inside the pipelines, which would lengthen the useful life of the pipeline.
Commsec numbers indicate that it could pay an annual distribution of 55 cents in FY23, translating into a forward yield of 4.85%.
Sonic Healthcare Limited (ASX: SHL)
This company is one of the largest healthcare pathology businesses in the world. It also offers radiology services, plus it has been heavily involved with COVID testing (which continues).
The Sonic Healthcare share price has fallen more than 30% in 2022 to date, boosting the prospective dividend yield. It has a stated progressive dividend policy. In FY23 it is expected to pay an annual dividend per share of $1.01, according to Commsec, translating into a grossed-up dividend yield of 4.5%.
Telstra Group Ltd (ASX: TLS)
This is the largest ASX 200 dividend share on the list.
Australia's biggest telecommunications business has long been seen as a dividend payer. But, it's finally getting back to dividend growth. It grew its final FY22 dividend from 8 cents per share to 8.5 cents per share – an increase of 6.25%.
The business is cutting costs, rolling out 5G, growing Telstra Health and increasing prices in line with inflation.
According to Commsec, it's expected to pay an annual dividend per share in FY23, which translates into a grossed-up dividend yield of 6%.
Brickworks Limited (ASX: BKW)
Brickworks is a diversified building products business. It owns half of an industrial property trust along with Goodman Group (ASX: GMG), as well as a sizeable chunk of Soul Pattinson shares.
The ASX 200 dividend share is the largest brickmaker in Australia and the northeast of the US. It also recently signed a deal to supply millions of bricks to the UK.
Brickworks hasn't seen a dividend cut for more than 40 years, so there has been a lot of stability. It's expected to pay a grossed-up dividend yield of 4.1% in FY23.
