APA Group (ASX: APA) shares are in the green on Thursday morning. At the time of writing, the shares are 0.22% higher at $9.12 each. That's a 3.18% drop over the month but an impressive 29.91% hike over the year to date.
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What about passive income from APA shares?
When it comes to high-yield dividends in the S&P/ASX 200 Index (ASX: XJO), the energy infrastructure group is a quiet achiever.
APA's business is dependable. The company operates gas pipelines and energy infrastructure across Australia, with the majority of its revenue generated from long-term contracts. That means its cash flow, and therefore its dividends, are fairly predictable too.
In fact, APA has one of the longest dividend growth streaks on the ASX, having hiked its payout every year for the last 20 years. Its yield is usually much higher than the wider market, too, which makes it an appealing option for investors seeking an ongoing passive income.
In FY25, the company increased its annual dividend distribution by 1.8% to 57 cents per security. Dividend growth is never guaranteed to continue, but it looks like increases are likely for FY26 and beyond.
APA said it plans to increase its payout to 58 cents per security in FY26, translating into a forward distribution yield of 6.2%.
It looks like the infrastructure group could easily increase its payout to at least 59 cents in FY27 and 60 cents in FY28.
What do the experts think of the stock?
Overall, analyst consensus is for a neutral stance on the stock. Data shows that 7 out of 10 analysts have a hold rating on APA shares. Another 2 have a buy or strong buy rating, and 1 has a sell rating.
At the time of writing, the average target price is $8.88; however, some expect the share price to climb up to $9.65.
Analysts at Macquarie are much more bullish than the majority. The broker recently raised its target price on APA shares following the company's joint-venture announcement earlier this month.
APA signed an agreement with CS Energy on the 2nd December to develop a new gas-powered plant in Queensland. APA said the investment in the plant is expected to "deliver returns consistent with its required return hurdles, will be funded from existing balance sheet capacity and forms part of APA's $2.1 billion organic growth pipeline".
The broker has an outperform rating and $9.23 target price on APA Group shares.
