Owning Wesfarmers Ltd (ASX: WES) shares for passive income makes a lot of sense given its dividend track record.

The company owns a number of leading Australian businesses including Kmart, Bunnings, Officeworks, Priceline and WesCEF (chemicals, energy and fertilisers).

Wesfarmers has been listed for decades and it has delivered great dividend growth over the long-term. On the company’s own website, the business says it wants to grow dividends:

With a focus on generating strong cash flows and maintaining balance sheet strength, the group aims to deliver satisfactory returns to shareholders through improving returns on invested capital. As well as share price appreciation, Wesfarmers seeks to grow dividends over time commensurate with performance in earnings and cash flow.

Let’s look at what the payout is projected to deliver and what it would take to make $10,000 of dividends.

Dividend projection

Considering we’re already in the 2027 financial year, I think it’s worthwhile to look at what could happen with the company’s annual dividend in FY27.

According to the projection on Commsec, the business is forecast to pay an annual dividend per share in FY27 of $2.33 – that would represent year-over-year growth of around 8% compared to the estimate for the annual payout of $2.16 in FY26.

At the time of writing, the potential payout for FY27 translates into a dividend yield of 2.5% excluding franking credits and 3.6% including franking credits.

That’s not the biggest dividend yield out there, but the business continues to retain some of its earnings to reinvest for growth, and the company is priced for its rising earnings. The yield could be noticeably higher by the end of the decade if it continues to grow its annual passive income.

Wesfarmers has increased its annual dividend each year since 2020, after spinning off Coles Group Ltd (ASX: COL) as a separate business. I think the quality of Wesfarmers’ earnings from Kmart and Bunnings will help it continue growing earnings in the next few years.

How many Wesfarmers shares are needed for $10,000 of passive income?

Receiving $10,000 of dividends from a single business would be a substantial amount, so I’d suggest investors should make sure their portfolio is diversified and not mostly reliant on Wesfarmers for passive income.

Based on the projection for the 2027 financial year, an investor would need 4,292 Wesfarmers shares excluding the franking credits. If we include the franking credits as part of the overall goal, an investor would need 3,005 Wesfarmers shares.

At the time of writing, the Wesfarmers share price has soared 30% since mid-May. While this is great for existing shareholders, it’s a less compelling buy for new shareholders. There are other ASX shares that could be better buys.

The post How many Wesfarmers shares do I need to buy for $10,000 of passive income? appeared first on The Motley Fool Australia.

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• Up 29% since May, can Wesfarmers shares keep surging higher?
• How to build an ASX dividend portfolio that keeps paying you for decades
• Buy, hold, sell: SKS Technologies, Yancoal, Wesfarmers shares
• How much is needed in superannuation to target a $100,000 annual passive income?

Motley Fool contributor Tristan Harrison 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 Wesfarmers. The Motley Fool Australia has recommended Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you are seeking big returns, then it could be worth checking out the ASX shares in this article.

That’s because the team at Bell Potter believes these shares could rise at least 90% over the next 12 months.

Here’s what the broker is recommending to clients:

Falcon Metals Ltd (ASX: FAL)

Bell Potter sees significant value in this gold explorer’s shares. In response to its latest drilling results, the broker has retained its speculative buy rating and $1.10 price target on the ASX share.

Based on its current share price of 36.5 cents, this suggests that upside of 201% is possible between now and this time next year.

Its analysts are very optimistic on Falcon Metals’ Blue Moon project in Victoria. They commented:

Blue Moon continues to shape as a potentially district-scale orogenic gold system, with these results defining a fifth mineralised zone with the system remaining open at depth and along strike. Each successive step-out has validated the geological model generated by FAL’s exploration team, which continues to identify additional stacked reefs where predicted, building our confidence in both the targeting and the scale on offer. 

Magnolia Zone does not form part of our Blue Moon NDS, offering valuation upside once the zone becomes derisked through further exploration. We maintain our Valuation of $1.10 and Speculative Buy recommendation.

Fenix Resources Ltd (ASX: FEX)

This iron ore miner’s shares could be deeply undervalued according to Bell Potter. In response to its fourth-quarter update, the broker has retained its buy rating on the ASX share with a trimmed price target of 54 cents.

Based on its current share price of 28 cents, this implies potential upside of approximately 93% for investors.

Bell Potter was pleased with its performance in the fourth quarter and is positive on the company’s production growth outlook. Commenting on its outlook, the broker said:

FEX’s FY27 guidance points to sales of 4.7-5.3Mt, up 14% YoY at the midpoint. Notably, C1 cash cost guidance is consistent with FY26 at A$70-80/t, demonstrating strong cost discipline during a highly inflationary environment.

FEX has outlined a clear pathway to incrementally grow iron ore production to 10Mtpa at significantly lower unit costs, leveraging its integrated logistics network to underpin cash flows and fund its substantial organic growth outlook. FEX holds the largest storage position at the strategic and fast-growing Geraldton Port.

The post Bell Potter says these ASX shares could rise 90% to 200% appeared first on The Motley Fool Australia.

More reading

• 2 ASX shares highly recommended to buy: Experts
• How many Wesfarmers shares do I need to buy for $10,000 of passive income?
• Why I’d buy Qantas, Woolworths, and ResMed shares
• 5 things to watch on the ASX 200 on Wednesday
• BHP shares have tripled in the past 10 years. Could history repeat itself over the next decade?

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 no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Qantas Airways Ltd (ASX: QAN), Woolworths Group Ltd (ASX: WOW), and ResMed Inc. (ASX: RMD) shares are popular with Aussie investors.

It isn’t hard to see why. All three have strong market positions and well-known brands.

But could they be good investments today? I think they could. Here is why I would buy them.

Qantas shares

Airlines can make even confident investors nervous. Fuel prices, competition, economic conditions, weather, and operational problems can quickly disrupt forecasts. I would never approach Qantas shares expecting a perfectly smooth journey.

But the company still has advantages that would be extremely difficult for a new competitor to reproduce.

Its domestic network, airport slots, Qantas brand, Jetstar operations, and frequent flyer ecosystem have been built over decades. The loyalty division is especially appealing because it earns money through credit cards, retail partners, points, and travel rewards without depending entirely on ticket sales.

Fleet renewal could also reshape the business. Newer aircraft can improve fuel efficiency, reduce maintenance requirements, open new routes, and provide a better passenger experience. The investment bill will be substantial, but I think Qantas has a genuine opportunity to emerge with a more efficient and flexible fleet.

The sector will remain volatile, so I would keep my position sensible. Even so, I think the airline’s competitive position and range of earnings streams make Qantas shares worth buying.

Woolworths shares

Woolworths appeals to me for a completely different reason.

Groceries sit close to the centre of household spending. Customers may change brands, hunt harder for value, or reduce discretionary purchases, but they still need food and everyday essentials.

That dependable demand gives Woolworths a strong base.

The company also has more to work with than a large store network. Online shopping, loyalty data, automated distribution, delivery services, and personalised offers can all shape how Woolworths competes over the next decade.

I particularly like the potential of Everyday Rewards. A deeper understanding of customer behaviour can help Woolworths improve promotions, stock the right products, and build stronger relationships with shoppers.

Supermarket retail is intensely competitive, and the company must keep earning customer trust on price, availability, and service. Margins are also relatively thin, which means poor execution can have an outsized effect on profits. But I think it has a strong management team with the capabilities to deliver.

For me, Woolworths remains a leading Australian retailer with the scale and resources to improve, making the shares an attractive long-term buy.

ResMed shares

ResMed gives investors exposure to a healthcare need that remains far from fully addressed.

Millions of people live with sleep apnoea and other breathing disorders, while many remain undiagnosed or untreated. Better awareness, wider testing, and growing acceptance of home-based care could help ResMed reach many more patients.

Its relationship with customers can also continue well beyond the original device sale.

Patients need masks, replacement parts, monitoring, support, and software that helps them remain engaged with treatment. That recurring demand can make each new patient increasingly valuable over time.

Competition and changing treatment options deserve attention. However, ResMed has spent years building its brand, distribution, connected devices, and expertise in sleep health.

I think those strengths can support continued growth even as the treatment market evolves.

Foolish takeaway

I would buy Qantas, Woolworths, and ResMed because their long-term opportunities are supported by positions that have taken years to establish.

Each company still has work ahead of it, but with patient ownership and sensible position sizes, I think all three ASX shares could become more valuable over the years ahead.

The post Why I’d buy Qantas, Woolworths, and ResMed shares appeared first on The Motley Fool Australia.

More reading

• How to build an ASX dividend portfolio that keeps paying you for decades
• Here’s the dividend forecast out to 2028 for Woolworths shares
• Experts say these ASX 200 shares have great potential
• Top brokers name 3 ASX shares to buy next week
• Coles vs. Woolworths. Which ASX consumer staples stock is the best buy?

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