As an ASX 200 bank share, and one of the big four at that, Westpac Banking Corp (ASX: WBC) shares are often amongst the first ASX investments income investors turn to in the pursuit of dividends.
Like most ASX bank shares, Westpac has been forking out hefty fully-franked dividends for decades.
This has pleasingly accelerated over the past few years too. In 2021, Westpac forked out a total of $1.18 per share in fully-franked dividend payments. But by last year, this had risen to an annual total of $1.25 per share.
The trend has happily continued in 2023 as well. The bank’s first interim dividend for 2023 that we saw just last month came in at 70 cents per share. That was a sizeable increase over the interim dividend of 61 cents per share Westpac investors enjoyed last year.
Today, the bank’s last two dividend payments give Westpac shares a trailing dividend yield of 6.07%, or 8.67% grossed-up with that full franking.
But could Westpac’s dividends keep rising into FY2024, pushing up this dividend yield even higher in the future?
Can Westpac shares keep raising their fully-franked dividend payments?
That’s certainly what one ASX broker reckons. As we covered earlier this month, Morgans has named Westpac as a buy, with a 12-month share price target of $24.22. If realised, that would see the shares climb a pleasing 9.9% from their current level by July 2024.
But income investors will be especially delighted by what Morgans is anticipating when it comes to dividend payments. The broker has pencilled in a total of $1.49 per share in dividend income for shareholders over FY2023. That implies that Morgans is predicting a December final dividend later this year of 79 cents per share.
If that does come to pass, it would be a dramatic jump from Westpac’s last final dividend of 64 cents per share. It gets even better though. Morgans is also anticipating that this ASX 200 bank share will dial up its dividends again over FY2024, lavishing a total of $1.52 in dividends per share.
That would represent a forward yield of 6.9% for investors at present if Morgans is on the money here.
So lot to look forward to for Westpac investors in the dividend department if this ASX broker is accurate in its forecasts. But we’ll just have to wait and see what eventuates.
Right now, the Westpac share price remains down by 3.04% year to date, but up 4.4% over the past 12 months:
