The prospect of generating a steady passive income from Australian shares remains as attractive as ever in 2025.
For investors seeking stability and returns, dividend-paying stocks can be a reliable option.
By focusing on well-established companies with strong fundamentals and consistent payout histories, you can build a passive income stream that helps you meet your financial goals.
Here are three top Australian dividend shares that analysts believe could be great picks for generating passive income in 2025.
Harvey Norman Holdings Limited (ASX: HVN)
Retail giant Harvey Norman could be a standout choice for dividend-focused investors. Analysts at Bell Potter see the company benefiting significantly from an AI-driven upgrade cycle of electronic devices purchased during the pandemic.
For FY 2025, Bell Potter expects Harvey Norman to pay fully franked dividends of 25.9 cents per share, rising to 28.5 cents per share in FY 2026. Based on the current share price of $4.63, this translates to attractive dividend yields of 5.6% and 6.15%, respectively.
In addition to its income potential, Harvey Norman's shares appear undervalued according to the broker. Bell Potter has a buy rating with a price target of $5.80 on them, highlighting the stock's appeal for both value and income investors.
APA Group (ASX: APA)
Energy infrastructure giant APA Group is another strong contender for passive income seekers. With a diversified $26 billion portfolio of gas, electricity, solar, and wind assets, the company is well-positioned to deliver consistent returns.
In fact, APA Group is on track to achieve its 20th consecutive year of dividend growth. The team at Macquarie forecasts dividend increases to 57 cents per share in FY 2025 and then 57.5 cents in FY 2026. This equates to big yields of 8.3% and 8.4% based on the current share price of $6.85.
Macquarie also sees plenty of upside for its shares, giving them an outperform rating and a price target of $8.02.
Telstra Group Ltd (ASX: TLS)
Telstra, Australia's leading telecommunications company, rounds out the list. Analysts at Goldman Sachs believe Telstra's mobile business will underpin low-risk earnings and dividend growth.
Goldman forecasts fully franked dividends of 19 cents per share in FY 2025 and 20 cents per share in FY 2026. This equates to dividend yields of 4.7% and 4.9%, respectively, based on the current share price of $4.05.
With a buy rating and a price target of $4.50, Goldman Sachs sees Telstra as a stable income-generating option with the potential for moderate capital appreciation.
