Commonwealth Bank of Australia (ASX: CBA) shares are currently the lowest yielding of the big four, offering investors a mediocre 3.57% dividend yield. But could it be about to grow the passive income it hands to investors?
One expert thinks the biggest of the S&P/ASX 200 Index (ASX: XJO)'s big four banks could boost its dividends significantly in the coming years.
Indeed, it could be on track to grow its offerings by 18%, potentially boosting its yield along with them.
Right now, the CBA share price is trading at $107.65.
Let's take a closer look at what income investors might expect from CBA shares in the coming years.
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CBA's dividends tipped to soar
CBA shares might not be the big four bank income investors tend to turn to. Indeed, the giant's 3.57% yield is dwarfed by the likes of ANZ Group Holdings Ltd (ASX: ANZ) shares.
ANZ – which happens to be the smallest of the big four – currently offers a 5.89% dividend yield, the highest of its peers.
But CBA's dividends might be about to jump 18%, according to broker Morgans.
It tips the bank to offer $4.10 of dividends per share this financial year, as my Fool colleague James recently reported.
That's up from $3.85 per share last financial year and comprises a $1.75 interim payout and $2.10 final offering, both of which were fully franked.
And the financial year 2024 could bring even more dividend growth. Morgans forecasts CBA to declare $4.55 of dividends per share next fiscal year.
That would see the bank trading with a 4.22% dividend yield at its current share price – an 18.2% increase.
Are CBA shares a passive income buy?
With that in mind, could CBA shares represent a passive income buy right now?
Interestingly, Morgans had a hold rating on the stock in November. It slapped it with a $94.57 price target – representing a potential 12% downside.
Meanwhile, Jefferies is said to expect the CBA share price to slide 15% to trade at $91.30.
