3 ASX dividend stocks to help build passive income

Building passive income from ASX stocks does not have to mean sticking with the obvious names.

While banks and infrastructure stocks often dominate the dividend conversation, there are other companies that can provide income from very different parts of the economy.

Here are three ASX dividend stocks that could be worth looking at.

Elders Ltd (ASX: ELD)

The first ASX dividend stock to look at is Elders.

It is one of Australia’s leading agribusiness companies. It provides products and services to farmers across areas such as rural supplies, livestock, wool, real estate, and financial services.

This gives the company exposure to the agricultural economy without being tied to just one commodity. Its earnings can still be influenced by seasonal conditions and farmer confidence, but the breadth of the business provides several revenue streams.

This means that its dividends are linked to a business serving an essential industry. As demand for food and agricultural production continues over time, Elders remains positioned in a market with long-term relevance. This is particularly the case following the recent acquisition of Delta Agribusiness for $475 million, which boosts its position in crop protection and animal health.

Jumbo Interactive Ltd (ASX: JIN)

Another ASX dividend stock worth considering is Jumbo Interactive.

It operates digital lottery platforms and provides lottery software services. Its best-known brand is Oz Lotteries, which allows customers to buy lottery tickets online.

The company has a capital-light model, which can support strong cash generation when trading conditions are favourable. It also benefits from the continued shift from physical lottery purchases to digital channels.

Jumbo’s earnings can be influenced by jackpot activity, as larger jackpots tend to drive higher customer engagement. But over the long term, the move toward online lottery participation remains an important growth driver.

With a digital platform, strong margins, and cash-generative operations, Jumbo offers a dividend profile that looks very different from traditional income stocks.

Sonic Healthcare Ltd (ASX: SHL)

A third ASX dividend stock that could help build passive income is Sonic Healthcare.

Sonic is a global pathology and laboratory medicine business. It provides diagnostic testing services across Australia, Europe, and North America.

Healthcare demand tends to be more resilient than many other parts of the economy. People still need medical testing through different economic conditions, which gives Sonic a defensive quality.

The company also has global scale, which helps diversify earnings across markets and healthcare systems.

While pandemic-related testing provided a temporary boost in past years, the underlying business remains supported by ageing populations, chronic disease management, and ongoing demand for diagnostics. This bodes well for its long-term dividend outlook.

The post 3 ASX dividend stocks to help build passive income appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Jumbo Interactive. The Motley Fool Australia has recommended Elders, Jumbo Interactive, and Sonic Healthcare. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.