As far as 'super-safe' goes, the share market is not as protected as cash in the bank. But, there is one high-yield ASX dividend champion that I think really ticks the box.
When it comes to safe dividend-paying businesses, I'd normally name Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). However, I don't think its yield is high enough to be counted as a high-yield option.
The business I want to highlight is APA Group (ASX: APA), a long-time favourite of mine for passive income.
We can't control what happens with the share price, but the prospect for good earnings growth looks positive and I'm even more confident about long-term payout growth.
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Is it super-safe?
As I've mentioned, no share price is impervious to share price declines. But, businesses with resilient earnings may fall less than others during bear markets. I think APA is one of those reliable businesses.
It owns a portfolio of important energy assets Australia, including gas pipelines, energy generation (gas, solar and wind), gas processing facilities, gas storage and electricity transmission.
Impressively, the business transports half of the country's gas usage. I think it's likely the country will continue using gas for decades for come, giving the business pleasing defensive earnings.
Additionally, APA's revenue is largely linked to inflation. That provides the business with a solid organic tailwind for cash flow growth in the coming years.
High yield
It has satisfactorily ticked the 'super-safe' requirement as much as it can. But what about having a high dividend yield?
If I'm buying a business for passive income, I'd want to see that it offers a much better cash payment than the Reserve Bank of Australia (RBA) official cash rate. The RBA cash rate is currently 3.6%.
The ASX dividend champion APA is expecting to deliver a distribution per security of 58 cents in FY26. That translates into a distribution yield of 6.25%, at the time of writing. That's much more appealing than the RBA cash rate.
ASX dividend champion
Distribution growth is not guaranteed, but the business has a pleasing record of delivering putout growth that I expect it will want to continue.
It actually has the second-longest distribution growth streak on the ASX – APA has hiked its payout every year for the last 20 years!
I think it's likely that APA will want to continue growing its annual payout by at least 1 cent per security for the foreseeable future.
Energy is very likely to be in demand over the long-term, which is why I think it could be a solid buy even if there's a stock market sell-off in 2026 or in any given year.
