ASX passive income: Is Westpac stock a buy, sell, or hold?

Are analysts feeling bullish on this bank?

| More on:
Woman holding $100 Australian notes representing 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

Like the rest of the big four banks, Westpac Banking Corp (ASX: WBC) shares are a popular option for passive income.

The banking giant's shares feature heavily in income portfolios and superannuation funds across the country.

But for those that don't already own Westpac stock, is it a buy now, hold, or sell now following its update this month?

Let's see what analysts are saying about Australia's oldest bank.

Should you buy Westpac stock for passive income on the ASX?

The broker community remains divided on whether you should be buying Westpac shares following its quarterly update.

UBS and Morgan Stanley, for example, currently have the equivalent of sell ratings on its shares with price targets of $20.00 and $21.70, respectively.

Over at Goldman Sachs, Citi, and Morgans, its analysts have hold/neutral ratings with price targets ranging from $22.25 to $23.54.

Whereas Ord Minnett and Macquarie are currently the most positive brokers out there with the equivalent of buy ratings and price targets of $28.00 and $25.00, respectively. Though, it is worth noting that Westpac's shares have recently surpassed Macquarie's price target.

What about income?

One thing that the brokers do agree on is that Westpac is likely to provide investors with a decent source of passive income in the near term.

Analysts are forecasting fully franked dividends in the range of $1.42 to $1.46 per share in FY 2024. Based on the current Westpac share price of $26.20, this will mean dividend yields of 5.4% to 5.6%.

And in FY 2025, the forecast dividend widens to a range of $1.39 to $1.50 per share. This equates to yields of 5.3% to 5.7%.

This means that if you were to invest $10,000 into Westpac's ASX shares, you would expect to receive passive income in the region of $550 in both FY 2024 and FY 2025.

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor James Mickleboro has positions in Westpac Banking Corporation. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. 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

Woman calculating dividends on calculator and working on a laptop.
Dividend Investing

3 ASX 300 dividend stocks to buy now for income

Brokers think these dividend stocks are buys right now. What sort of yields are they forecasting?

Read more »

Stressed thoughtful old female general practitioner doctor physician looking in distance, considering difficult medical problem solution or illness treatment, working on computer in clinic office.
Healthcare Shares

How much do you need to invest in CSL shares for $8,000 in annual dividends?

CSL's dividends are exponentially more valuable for long-term investors.

Read more »

A male investor wearing a blue shirt looks off to the side with a miffed look on his face as the share price declines.
Dividend Investing

Why is the Soul Patts share price falling today?

Is today's decline actually good news?

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.
Dividend Investing

Is Telstra stock a smart buy right now for dividends?

Would I buy Telstra shares for that hefty dividend yield today?

Read more »

Three women cruise along enjoying ice-creams in the sunshine.
Dividend Investing

The best dividend stocks in Australia right now

Growth and stability are just two of the reasons why I think these are the top ASX 300 stocks for…

Read more »

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

Buy these ASX dividend shares with 6% to 8% yields: Bell Potter

Big yields could be coming for owners of these shares.

Read more »

Broker looking at the share price.
Dividend Investing

Goldman Sachs names 3 strong ASX 200 dividend shares to buy

Here's why the broker is bullish on these dividend shares.

Read more »

A mature aged man with grey hair and glasses holds a fan of Australian hundred dollar bills up against his mouth and looks skywards with his eyes as though he is thinking what he might do with the cash.
Dividend Investing

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

This coal mining stock has dished out some pretty impressive dividends in recent years, but will this continue?

Read more »