Should I buy Coles shares for passive income?

Coles Group Ltd (ASX: COL) shares have a lengthy track record of paying two fully franked dividends a year.

But is the S&P/ASX 200 Index (ASX: XJO) supermarket giant a good buy for passive income today?

We’ll look at Catapult Wealth’s Dylan Evans recommendation below (courtesy of The Bull).

But first, a little background.

Atop the passive income on offer, Coles stock has outperformed in 2026.

On Monday, shares were changing hands for $23.07 each, up 8.1% year to date. That compares to the 0.1% loss posted by the ASX 200 this calendar year.

As for the latest round of passive income, when Coles released its FY 2026 results on 25 August, the company declared a fully franked final dividend of 37 cents per share. That’s an increase of 15.6% from the FY 2025 final Coles dividend.

If you held the stock at market close on 2 September, you can expect to see that income hit your bank account tomorrow, on 22 September.

Adding in the 41 cent per share interim dividend, paid on 30 March, and at the recent share price, Coles shares trade on a fully franked trailing dividend yield of 3.4%.

Which brings us back to…

Are Coles shares are good passive income buy?

“The supermarket industry structure remains favourable, with Coles and competitor Woolworths dominating market share,” Catapult Wealth’s Evans said.

Commenting on Coles FY 2026 results, he noted:

Coles posted group sales revenue of $45.580 billion in full year 2026, up 2.8 per cent on the prior corresponding period. Excluding significant items, group earnings before interest and tax of $2.322 billion was up 9.9 per cent. Supermarket eCommerce sales was a highlight, growing 26.4 per cent.

Summarising his buy recommendation on Coles shares, Evans concluded, “Coles offers a reliable dividend yield, backed by defensive earnings. Catalysts for growth include online expansion, population growth and supply chain automation.”

Bonus ASX 200 stock tip

Atop his buy recommendation on Coles shares, in part for the company’s reliable passive income payouts, Evans also issued a buy recommendation for Netwealth Group Ltd (ASX: NWL).

“Netwealth operates a leading investment management platform used by financial advisers in Australia,” he said.

As for his bullish outlook on the ASX 200 finance stock, Evans noted:

The company’s full year 2026 results continued to deliver strong growth, with the platform’s funds under administration increasing 20.3 per cent to $135.7 billion and earnings per share growing 16 per cent to 55.2 cents.

Despite these strong results, the share price has fallen significantly, most likely and partially in response to a compensation payout of about $101 million to members in the collapsed First Guardian Master Fund.

Share price weakness presents an opportunity, as Netwealth still holds a net cash position and is poised to generate strong revenue growth moving forward.

I’ll add that Netwealth also provides some passive income, with the ASX 200 stock trading on a 2.2% fully franked trailing dividend yield.

The post Should I buy Coles shares for passive income? appeared first on The Motley Fool Australia.

More reading

• Buy, hold, sell: Coles, NAB, CSL shares
• 2 ASX 200 shares to buy and 1 to sell now
• Here’s the dividend forecast out to 2029 for Coles shares
• Netwealth Group vs HUB24: Which financial platform is better from an investor’s perspective?
• How much do I need in superannuation to receive $1,000 passive income per week?

Motley Fool contributor Bernd Struben 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 Netwealth Group. The Motley Fool Australia has positions in and has recommended Netwealth Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.