There's nothing quite like the sound of passive income from S&P/ASX 200 Index (ASX: XJO) dividend stocks landing in your bank account to put a smile on your face.
Okay, there's no sound.
But I'm sure you know what I mean!
Aussie investors are a bit spoiled for choice when it comes to passive income stocks, especially with many offering full franking credits.
But I want to drill down to just one glorious ASX dividend stock today.
Namely, ASX 200 miner Rio Tinto Ltd (ASX: RIO).
We'll dig into the numbers in a tick. But first…
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Trailing yields and future yields
Before we look at the passive income potential of Rio Tinto shares, bear in mind that the yields you generally see quoted are trailing yields. Future yields may be higher or lower depending on a range of company-specific and macroeconomic factors.
In the case of Rio Tinto, the dividend payouts have come down from the heady years of 2021 and 2022 when the iron ore price was rocketing to all-time highs.
However, the final dividend paid in April this year was up 20% on the final dividend paid in April 2023.
And with the iron ore price up 16% since 4 April, proving more resilient than many analysts have been forecasting, I believe the passive income outlook for Rio Tinto shares remains quite strong.
With that said…
Mining Rio Tinto for annual passive income
Atop offering a juicy yield, Rio Tinto has a track record of delivering two fully franked dividends a year for more than a decade.
As for the past year, the ASX 200 miner paid a fully franked interim dividend of $2.61 a share on 21 September.
And Rio Tinto gave passive income a pleasant surprise when it reported its full-year results on 21 February.
Although revenue slipped 3% from 2022 to US$54.04 billion, and underlying earnings before interest, taxes, depreciation and amortisation EBITDA declined 9% year on year to US$23.89 billion, management declared a fully franked final dividend of $3.93 a share.
All told then, this glorious ASX 200 dividend paid out a total of $6.54 a share in fully franked dividends over the past 12 months.
Or $1,962 in passive income from just 300 shares.
Rio Tinto share price snapshot
Atop that very handy passive income (which we've established makes no sound when you receive it), Rio Tinto shares also offer the potential for capital gains.
Over the past year, the Rio Tinto share price has increased more than 21.9%, closing on Friday at $132.20 a share.
