The great thing about ASX shares is that they can grow their profit over time, justifying share price rises. The generation of profit also allows a business to pay passive income to investors. That's a strong combination, in my view.
I think earnings growth is key because if a business is on an irreversible downward earnings trend, it can lead to capital losses for investors.
With that in mind, let me tell you about two of my favourite ASX shares for dividends right now.
Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
This ASX share is the largest position in my portfolio because it's providing what I like to see – long-term dividend growth and capital growth.
It's an investment business that has been operating for more than 120 years. It aims for investments that provide defensive cash flows and can deliver long-term growth. The company is invested in a number of ASX shares including Brickworks Ltd (ASX: BKW), TPG Telecom Ltd (ASX: TPG), Tuas Ltd (ASX: TUA), New Hope Corporation Ltd (ASX: NHC), Pengana Capital Ltd (ASX: PCG), Propel Funeral Partners Ltd (ASX: PFP) and more. Some of its private investments include swimming schools, agriculture and credit.
I like that buying Soul Patts shares comes with significant internal diversification and its portfolio is steadily growing thanks to existing investments growing and new investments regularly being made. That long-term rise of the portfolio's underlying value is helping push the Soul Patts share price higher.
On the dividend side of things, the ASX share receives investment cash flow from its portfolio and pays a majority of that to shareholders. The company has increased its annual ordinary dividend every year since 2000, which is the longest growth streak on the ASX. It currently has a grossed-up dividend yield of 3.3%, including franking credits.
GQG Partners Inc (ASX: GQG)
GQG is one of the largest fund managers on the ASX. While it's headquartered in the US, it also has a growing global geographic presence, with progress in countries like Canada, the UK and Australia.
As a funds management business, the key metric for success is the funds under management (FUM). GQG hardly charges any performance fees at all, which should appeal to clients. Therefore, FUM growth essentially decides what the revenue growth will be, which flows onto the profit generation and dividend payments.
The ASX share is seeing pleasing FUM growth, partly due to the good investment performance of its funds. At December 2024, it had total FUM of US$153 billion. By 31 May 2025, it had grown 10% over the months to US$168.5 billion. In 2025 to date, it has seen US$7.4 billion of net inflows.
I'm seeing good potential for both earnings growth and dividend growth for the foreseeable future. The Macquarie forecast for GQG suggests a possible dividend yield of approximately 10.5% in FY26.
