The Australian share market is a great place for those that are searching for a passive income.
Especially with some ASX 200 stocks paying out a good portion of their profits to shareholders each year.
One ASX 200 monopoly stock that does exactly this is Transurban Group (ASX: TCL).
It is a toll road builder and operator with a portfolio of hugely important roads across Melbourne, Sydney, and Brisbane, as well as in Greater Washington, United States and Montreal, Canada.
For example, in Melbourne the company has CityLink and the West Gate Tunnel Project. Whereas in Sydney, it has the Cross City Tunnel, Eastern Distributor, and Westlink M7 to name just three.
In addition, Transurban classes itself as a technology company, noting that it researches and develops innovative tolling and transport technology to make travel easier for everyone.
Passive income from this ASX 200 monopoly stock
I would class Transurban as a monopoly stock due to its domination of toll roads in New South Wales, Victoria, and Queensland. This gives it strong pricing power, especially with Australian roads getting busier and busier as the population grows.
If you want to save time and not get stuck in traffic, you use Transurban's roads. In fact, in yesterday's annual general meeting update the company revealed that it delivered 446,000 hours in average workday travel time savings in FY 2024.
This strong price power, combined with increasing traffic on its roads and growth projects, means that the ASX 200 monopoly stock has been able to grow its earnings and dividends at a solid rate over the last decade.
For instance, yesterday, CEO Michelle Jablko reiterated that a dividend of 65 cents per share is expected in FY 2025. This compares to 39 cents per share in 2015.
Based on its current share price of approximately $13.00, this means that a 5% dividend yield awaits investors over the next 12 months if everything goes to plan.
So, if you were to buy 1,540 Transurban shares today for a total of approximately $20,000, you would be generating $1,000 in passive income in 2025.
Big returns potential
In addition, it is worth noting that UBS currently has a buy rating on the ASX 200 monopoly stock with a price target of $14.60.
If the Transurban share price were to rise to that level, it would mean those 1,540 shares have a market value of $22,484. That's almost $2,500 more than your original investment and then $1,000 of passive income on top!
