The Australian share market has a lot of options for passive income investors.
As one of the most generous markets in the world, there are countless ASX dividend stocks for investors to choose from.
One that has long been a firm favourite of income investors is Telstra Group Ltd (ASX: TLS).
It is of course Australia's leading telecommunications company, providing millions of consumers and businesses with broadband and mobile phone services.
This strong market position means that Telstra is printing money and able to share that with its shareholders in the form of dividends each year.
But what would it take to generate $300 per month in passive income from Telstra's shares? Let's find out.
Passive income from this ASX dividend stock
According to a note out of Goldman Sachs this week, its analysts are expecting Telstra to increase its dividend to 19 cents per share in FY 2025.
Clearly, we would need a good number of Telstra shares to pull in $300 of passive income per month.
$300 is the equivalent of $3,600 per year. Based on FY 2025's forecast dividend, income investors would need to have approximately 18,947 shares to generate the desired annual income.
So, with the Telstra share price currently fetching $3.97, this would take a sizeable investment of just over $75,000.
But it could be worth it according to Goldman Sachs. That's because its analysts have just reaffirmed their buy rating with an improved price target of $4.50.
This implies potential upside of 13.3% for investors over the next 12 months and would give those 18,947 shares a market value of $85,261.50 excluding dividends.
Commenting on its buy rating, the broker said:
Reiterate Buy on Telstra (A$4.50 TP, +13% upside) and Sell on TPG ($4.20 TP, -6% downside): Our positive view on Telstra reflects its ability to grow Mobile/InfraCo earnings and support sustained DPS growth. However, we do believe TLS is well placed to deliver another year of strong NBN earnings growth, given recent consecutive price rises are more than offsetting subscriber losses and access price rises (C&SB EBITDA +37% in FY25).
This contrasts to TPG, which we expect to deliver flat NBN margins in FY25 while ceding customers, contributing to our forecast -1% earnings decline in FY25. Ultimately we expect both TLS and TPG to respond to market conditions and look to stabilize their customer bases, impacting earnings growth in FY26.
