Westpac Banking Corp (ASX: WBC) shares are a popular option for income investors.
This is because Australia's oldest bank is among the biggest dividend payers on the Australian share market.
For example, in FY 2023, the bank returned a total of $5 billion to shareholders in the form of dividends.
This was through the payout of fully franked dividends of 142 cents per share. Which, based on the current Westpac share price of $23.10, represents a generous 6.15% dividend yield.
Image source: Getty Images
Passive income from Westpac shares
Clearly, with a yield like that, Westpac shares are a great source of passive income. But how much would you need to invest if you wanted to receive $3,000 in dividends each year? Let's have a look and find out.
According to a recent note out of Ord Minnett, its analysts are forecasting fully franked dividends of $1.45 per share in FY 2024.
If this estimate proves accurate, you would need to own approximately 2,069 Westpac shares in order to receive $3,000 in passive income. This would mean an investment of $47,793.90 into the big four bank's stock.
But it could be worth it if Ord Minnett is on the money with its recommendation. The broker has an accumulate rating and a $28 price target on its shares.
If your shares were to rise to this level, they would have a market value of $57,932. That's over $10,000 greater than your original investment and excludes the $3,000 of passive income.
All in all, the broker appears to see Westpac as a great option if you're currently lacking any meaningful banking sector exposure in your portfolio today.
