This 10% ASX dividend stock is my top pick for immediate income

This business offers a lot of what income investors are looking for.

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In my opinion, the ASX dividend stock GQG Partners Inc (ASX: GQG) is one of the most compelling businesses for passive income on the ASX.

It pays a dividend every quarter, so investors usually don't have to wait long for the next payment to be sent to their bank accounts.

The next quarterly dividend is likely to be paid in June, so investors have less than two months to wait.

But, the frequency of payouts is not the most important thing for shareholders of this business, in my view. There are three factors that I believe make this funds management business appealing. Let's get into those.

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Dividend yield

The business is committed to rewarding shareholders with a pleasing payout. Its dividend payout ratio has been 90% in recent times, though it may not always be that level.

The broker Goldman Sachs is forecasting that GQG could pay an annual dividend per share of US 14 cents in FY25.

At the current GQG share price, that translates into forward dividend yields of 10%.

There are not many ASX dividend stocks projected to have a double-digit yield and a good chance of growth.

Payout growth

When the size of a company's dividend is decided by its dividend payout ratio, then profit changes will be the biggest factor for the dividend.

As a fund manager, its profit is decided by revenue growth, and the revenue growth is decided by the funds under management (FUM).

At 31 December 2024, the business had US$153 billion of FUM, which had grown to US$161.9 billion at 31 March 2025. I'm not expecting FUM growth every quarter or even every year. But the ongoing monthly net inflows of more than US$1 billion should help, as should GQG's pleasing investment performance of its funds, which is driving organic growth of FUM.

Goldman Sachs is predicting the GQG payout could grow to 16 cents per share, which would be a dividend yield of 11.4% from the ASX dividend stock.

I think FUM can grow satisfactorily in the next few years if GQG's investment funds can outperform their benchmarks.

Stability?

No business can guarantee dividend growth. But GQG's payouts have been generally rising since its first payment in 2022.

I think the business is capable of delivering a more stable dividend than more volatile sectors such as ASX mining shares or ASX retail shares.

In terms of total dividend income, I believe this ASX dividend stock could be the most attractive choice for large dividends in the short term and the foreseeable future.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has recommended Gqg Partners. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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