Buy and hold investing is a great way to grow your wealth. It is also a great way to grow a passive income in the share market.
That's because the longer you hold onto a growing ASX 200 dividend stock, the larger its dividend will become.
But which dividend stocks could be great long term options? Let's take a look at three:
APA Group (ASX: APA)
The first ASX 200 dividend stock to look at for the long term is APA Group. It is an energy infrastructure company that owns a $27 billion portfolio. This comprises electricity transmission, gas distribution, solar and wind farms, and battery station assets.
APA Group is currently on one of the longest dividend increase streaks on the Australian share market. It will soon have lifted its payout for 20 years in a row.
The good news is that Macquarie believes this trend will continue. The broker is forecasting dividends per share of 56 cents in FY 2024 and then 58 cents in FY 2025. Based on the current APA Group share price of $7.99, this equates to 7.1% and 7.3% dividend yields, respectively.
Macquarie has an outperform rating and $9.40 price target on its shares.
Coles Group Ltd (ASX: COL)
Another ASX 200 dividend stock that could be a great long term option for income investors is supermarket giant Coles.
Thanks to its leadership position, population growth, store network expansion, and higher prices, it has been able to grow its earnings and dividend at a solid rate for some time. And with these factors all still in place, the next decade and beyond look positive for shareholders.
In the meantime, analysts at UBS are bullish and are forecast fully franked dividends per share of 70 cents in FY 2024 and then 74 cents in FY 2025. Based on its current share price of $18.39, this equates to yields of 3.8% and 4%, respectively.
UBS currently has a buy rating and $19.50 price target on the company's shares.
Lovisa Holdings Ltd (ASX: LOV)
A third ASX 200 dividend stock that could be a great long term option is Lovisa.
It is a leading fast fashion jewellery retailer with over 850 stores across 30 countries. While this is a huge store network, it is only scratching at the surface of its global market opportunity.
This means that its earnings and dividends have the potential to grow materially over the next decade.
For now, analysts at Morgans are forecasting fully franked dividends of 80 cents per share in FY 2024 and then 86 cents per share in FY 2025. Based on the current Lovisa share price of $36.09, this implies yields of 2.2% and 2.4%, respectively.
Morgans has an add rating and $37.00 price target on its shares
