National Australia Bank Ltd (ASX: NAB) shares may be among the most popular ASX dividend options because of the company's financial strength, strong market position in banking (particularly in business banking), dividend yield, and fairly consistent passive income payouts.
The ASX bank share typically offers an attractive dividend yield, comparable to ANZ Group Holdings Ltd (ASX: ANZ) and Westpac Banking Corp (ASX: WBC), but it's better than what's on offer from Commonwealth Bank of Australia (ASX: CBA).
NAB's dividend has been largely resilient over the last several years, aside from the difficult year in 2020.
In the NAB FY26 half-year results, the ASX bank share maintained its dividend at 85 cents per share, with underlying cash earnings rising 0.1% year-over-year to $3.59 billion.
In this article, we're going to look at the potential annual FY27 dividend, which will be paid during 2027.
Image source: Getty Images
2027 dividend projection for owners of NAB shares
According to CommSec projections, the ASX bank share is expected to pay an annual dividend per share of $1.72 in the 2027 financial year. That would represent a year-over-year rise of 1.1%.
At the time of writing, this projection translates into a dividend yield of 4.1% excluding franking credits and 5.8% including franking credits.
If someone were to invest $10,000 in NAB, they would be able to buy 236 NAB shares, with a bit of change left over.
With those 236 NAB shares, in FY27 investors could receive $405.92 of cash and perhaps $173.97 of franking credits. That would be $579.89 overall.
Is this a good time to invest in the ASX bank share for passive income?
According to CMC Invest, there have been eight ratings on NAB shares within the last three months. Of those eight ratings, two were buy ratings, four were hold ratings, and two were sell ratings. So, investment professionals are, on average, neutral on the business right now.
The average price target of those eight ratings is $39.86. That means, collectively, those analysts think the NAB share price could fall more than 5% (at the time of writing) within the next 12 months.
The most optimistic price target is $49.93, which implies a possible rise of 18.2% from where it is at the time of writing.
Turning to the most negative price target, one broker thinks it could fall to $33.95 within the next year, implying a decline of close to 20%.
Therefore, the dividend could play an important part in whether the overall return is positive or not over the next 12 months.
However, with low/negative returns on offer (at the time of writing), the price targets suggest there are more compelling ASX shares to buy.
