1 ASX 200 dividend stock I'm buying for superior passive income in 2024

This ASX 200 dividend stock trades on a juicy yield and could see sizeable share price gains in 2024.

| More on:
An older couple driving in a convertible on a freeway.

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

Forgive me if it sounds a bit geeky, but I really enjoy researching S&P/ASX 200 Index (ASX: XJO) dividend stocks, looking for that next passive income jewel to add to my portfolio.

While my hunt isn't strictly limited to the ASX 200, I have found that the bigger companies tend to be less volatile. They also tend to be more reliable with their dividend payouts over time. And I prefer not to see my passive income stream take an unexpected hit.

As I've mentioned before, I also lean towards stocks paying fully franked dividends. That way, I can hold onto more of those dividend payments when the ATO comes around for its pound of flesh.

With that said, the dividend share I've got my eye on for passive income in 2024 is ASX 200 petroleum refiner and fuel distributor Ampol Ltd (ASX: ALD).

Tapping Ampol for superior passive income

Ampol reported its full 2023 calendar year results on 19 February. The Ampol share price closed up 0.8% on the day.

Among the highlights, the ASX 200 dividend stock achieved a 2% increase in earnings before interest and tax (EBIT) from 2022 – excluding significant items – to $1.30 billion.

Ampol also reported an all-time high total sales volume for 2023 of 28.4 billion litres, up 17% from the prior year. And while net profit after tax (NPAT) was down 25% year on year to $549 million, net borrowings also fell by more than $200 million to $2.2 billion.

As for that passive income I'm after, Ampol declared a record final fully franked dividend of $1.80 a share, up 16% from the 2022 final dividend. Which is a trend I like to see.

That brings the full-year dividend payout to $2.75 per share. At the recent price of $37.55 a share, that sees this ASX 200 dividend stock trading at a fully franked yield of 7.3%.

If I'm holding shares at market close on 29 February, I'll receive that $1.80 per share in dividends on 27 March. (Ampol trades ex-dividend on 1 March.)

Atop this welcome passive income, the Ampol share price also appears well-placed for more gains over the coming year. (Shares are up 18% over the past 12 months.)

Following on Ampol's 2023 results, Macquarie raised its target price for Ampol stock by 11% to $42.50 a share. That's more than 13% above current levels.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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

Australian dollar notes inside the pocket on jeans, symbolising dividends.
Dividend Investing

3 ASX dividend shares to buy with 5% to 7% yields

Analysts expect big yields from these buy-rated shares.

Read more »

Two excited woman pointing out a bargain opportunity on a laptop.
Dividend Investing

With 8%+ dividends, how long can these ASX 200 passive income shares stay cheap?

I think ASX 200 investors looking for ‘cheap’ passive income shares will want to check these out.

Read more »

A smiling woman puts fuel into her car at a petrol pump.
Dividend Investing

Where I'd invest $5,000 in ASX shares now for $1,000 of dividend income

The ASX offers a rich hunting ground for dividend income.

Read more »

a woman holds a facebook like thumbs up sign high above her head. She has a very happy smile on her face.
Dividend Investing

Bell Potter names the best ASX 300 dividend shares to buy

The broker has good things to say about these shares.

Read more »

Middle age caucasian man smiling confident drinking coffee at home.
Dividend Investing

Buy these ASX dividend stocks for passive income

Analysts expect attractive dividend yields from these shares.

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

Goldman Sachs names 3 super-strong ASX 200 dividend shares to buy

The broker is feeling bullish about these blue chip options.

Read more »

Male hands holding Australian dollar banknotes, symbolising dividends.
Bank Shares

Do the dividends from ANZ shares still come fully franked?

Is ANZ becoming a big four bank that doesn't frank its dividends?

Read more »

Woman in celebratory fist move looking at phone
Dividend Investing

Buy this cheap ASX 300 stock for a 26% return

Analysts expect big returns from this undervalued stock.

Read more »