If I invest $10,000 in ANZ shares how much passive income will I receive?

Is this big four bank a good option for income investors? Let's have a look.

| More on:
Excited woman holding out $100 notes, symbolising dividends.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

ANZ Group Holdings Ltd (ASX: ANZ) shares are a popular option for investors seeking passive income and it isn't hard to see why.

Each year, like the rest of the big four banks, ANZ shares a large portion of its profits with its shareholders in the form of dividends.

At present, the bank operates with a target dividend payout ratio of between 60% and 65%.

This means for every billion dollars of profit it makes, $600 million to $650 million lands right back in the pockets of shareholders. This led to a total of $4.2 billion being returned to them in FY 2022.

But will ANZ continue to line the pockets of shareholders with money? How much passive income would we receive if we invested $10,000 into its shares today? Let's find out.

Passive income from ANZ shares

On Thursday, ANZ shares finished the day trading at $25.37. This means that if you were to invest $10,000, you would receive approximately 394 units.

According to a note out of Goldman Sachs, its analysts are expecting the bank to declare a final dividend of 81 cents per share later this month with its full-year results. If this proves accurate, your 394 ANZ shares would generate $319.14 of passive income.

But that's just one dividend, there will be another coming in six months when the bank's half-year results are released.

As things stand, Goldman is expecting another 81 cents per share fully franked dividend with those results. This will mean another $319.14 of passive income heading your way.

All in all, that's a total of $638.28 in dividends expected over the next 12 months from a $10,000 investment.

It is also worth noting that Goldman currently has a conviction buy rating and a $27.38 price target on the bank's shares. If they were to reach that level, your 394 units would have a market value of $10,788 excluding dividends.

That's not a bad return if you ask me!

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Dividend Investing

Beautiful young couple enjoying in shopping, symbolising passive income.
Dividend Investing

An ASX dividend giant I'd buy over BHP stock

The dividends from this business have grown enormously.

Read more »

A group of businesspeople clapping.
Dividend Investing

Which ASX 200 financial share will pay the best dividend yield in FY24?

Is it a bank? Is it an insurer? Is it an investment company?

Read more »

A male sharemarket analyst sits at his desk looking intently at his laptop with two other monitors next to him showing stock price movements
Dividend Investing

Brokers name 2 ASX dividend shares to buy

These income options have been given the thumbs up by analysts.

Read more »

Man holding a calculator with Australian dollar notes, symbolising dividends.
Dividend Investing

If I invest $10,000 in Telstra shares, how much passive income will I receive in 2024?

Is Telstra a good option for income investors? Let's find out.

Read more »

a dog sleeping with cucumbers on his eyes
Dividend Investing

Buy 194 shares in this top ASX 200 dividend stock for $873 in passive income

This top ASX 200 dividend stock boosted its passive income payments after delivering $10.2 billion in FY 2023 profits.

Read more »

A family of four wearing Santa hats open presents on the beach next to a Christmas tree.
Dividend Investing

Top ASX passive income shares to buy in December 2023

A healthy flow of passive income can help you live the life you choose. Here are some cracker ideas that…

Read more »

A woman has a thoughtful look on her face as she studies a fan of Australian 20 dollar bills she is holding on one hand while he rest her other hand on her chin in thought.
Bank Shares

Should I buy ANZ shares for the 7% dividend yield?

ANZ is standing out from the banking pack right now.

Read more »

Excited woman holding out $100 notes, symbolising dividends.
Dividend Investing

2 ASX 300 dividend shares that analysts rate as buys

Here's what analysts are saying about these dividend shares.

Read more »