ANZ Group Holdings Ltd (ASX: ANZ) shares may be one of the more popular options for passive income on the ASX due to its scale, perceived stability and sizeable dividend yield.
Banks such as Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC) and National Australia Bank Ltd (ASX: NAB) are also recognised for their payouts.
Banks can offer a good dividend yield thanks to a mixture of a generous dividend payout ratio and a relatively low price/earnings ratio (P/E) ratio.
Let's take a look at what ANZ could deliver for shareholders in the coming year.
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Dividend projection
The ASX bank share could be a source of appealing dividends in the near-term based on what analysts think the bank could deliver.
According to the projection on Commsec, analysts predict that the business could pay an annual dividend per share of $1.66 in 2026. That would be an extremely similar dividend payout as the FY25 payment.
The dividend in the 2027 financial year could be another similar payout, according to the forecast on Commsec.
The prediction currently suggests the ASX bank share could pay an annual dividend per share of $1.66 in 2027. At the time of writing, that translates into a dividend yield of 4.5% excluding franking credits and potentially 6% including franking credits.
I reckon plenty of passive income investors would be happy with that level of dividend yield.
What would it take to unlock that passive income from ANZ shares?
If an investor wanted $1,000 of passive income in 2027 from the ASX bank share, it would require a sizeable investment.
Excluding the franking credits, an investor would need 603 ANZ shares to generate $1,000 of passive income if the payout is $1.66 per share in 2027.
If we include the franking credits as part of the income goal, then an investor may only need to buy 456 ANZ shares.
Is this a good time to invest in ANZ?
Experts are currently mixed on the business, with different recommendations. According to CMC Invest, there are currently eight ratings on the business, with three buy ratings, four hold ratings and one sell rating.
However, the average price target of those eight ratings is $35.29. That means those analysts collectively suggest the ANZ share price could decline by around 4% over the next year. Therefore, ANZ may not be one of the best investments to buy for total returns today.
