Wesfarmers Ltd (ASX: WES) shares have fallen around 15% over the past month.

At roughly $77.08, they are now much closer to their 52-week low than their recent peak.

I think the pullback has created a better opportunity to buy one of the ASX’s highest-quality businesses.

The businesses are still the main attraction

Wesfarmers owns a collection of market-leading businesses, including Bunnings, Kmart, Officeworks, and Priceline through Wesfarmers Health.

For me, Bunnings remains the standout. Its scale, store network, brand recognition, and relationships with suppliers have taken decades to build. Home improvement spending can move around with economic conditions, but Australians will continue repairing, renovating, and maintaining their homes over the long term.

Kmart has also developed a strong position around affordable everyday products. Its ability to source and develop its own ranges gives consumers a clear reason to keep returning.

I like owning a company with several established businesses capable of producing cash while management continues looking for new areas to invest.

Wesfarmers shares have pulled back

Wesfarmers has rarely looked cheap, and it still does not today.

According to consensus estimates, earnings per share are forecast to rise from $2.72 in FY27 to $2.90 in FY28 and $3.11 in FY29.

At $77.08, that puts the shares on a PE ratio of roughly 28 times forecast FY27 earnings, falling to around 25 times FY29 earnings.

That is still a premium valuation. But consider where investors were only recently. At the 52-week high of $94.70, the same FY27 earnings forecast would have put Wesfarmers on almost 35 times earnings.

I find the current price much easier to justify. Quality businesses rarely spend much time trading at obviously cheap valuations. I am more interested in whether the price gives me a reasonable chance to benefit from years of earnings growth.

I think it does now.

There is income along the way

The dividend outlook also moves in the right direction.

Consensus forecasts point to dividends per share of $2.34 in FY27, $2.49 in FY28, and $2.71 in FY29.

At today’s price, that starts with a forecast dividend yield of around 3%, with the potential for income to rise if those estimates are achieved.

I would not buy Wesfarmers primarily for the dividend, but steadily increasing payments can add to the long-term return.

Foolish takeaway

The 15% fall has made Wesfarmers shares considerably more interesting to me.

I am still paying a premium, so this is not a bargain-hunting exercise. I am paying for strong businesses, capable management, and an earnings outlook that points higher over the next few years.

At around $77.08, I think the balance between quality and price has improved enough to make Wesfarmers a buy.

The post Down 15%: Is it a good time to buy Wesfarmers shares? appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino has positions in Wesfarmers. 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.

ASX dividend shares can absolutely produce $10,000 a month, but it does take quite a bit of capital to invest.

$10,000 per month, or $120,000 per year, is roughly double the median full-time Australian wage.

Getting there requires a large amount of capital, a reasonable yield, and the patience to leave both alone.

Here is the actual maths, using three holdings I would happily build that income around.

Three ASX dividend shares to build the income

Telstra Group Ltd (ASX: TLS) is the defensive anchor.

Telstra shares closed Monday at $4.63 and yielded 4.56%, with franking running at roughly 90%.

FY26 delivered EBITDAaL of $8.2 billion and a fresh $1 billion buyback, alongside a full-year dividend of 21 cents per share.

The shares have fallen 7.03% over twelve months and now sit close to their 52-week low of $4.56.

APA Group (ASX: APA) does the heavy lifting on yield.

The company closed at $10.83 with a 5.39% distribution yield and a market capitalisation of $14.42 billion.

FY26 underlying EBITDA rose 8.3% to $2,183 million and free cash flow increased 3.2% to $1,118 million.

The FY26 distribution was 58.0 cents per security, and management has guided to 59.0 cents in FY27.

The important caveat is that APA’s distributions are only partially franked, at around 31%.

Vanguard Australian Shares High Yield ETF (ASX: VHY) provides the diversification.

It holds 92 companies led by the major banks and BHP, and Vanguard forecasts a yield of 4.2%, or 5.5% once franking credits are counted.

Units closed Monday at $85.61.

The maths on $10,000 a month

Spread evenly across the three, the cash yield averages 4.72%.

To generate $120,000 a year at that rate, you need roughly $2.54 million invested.

Franking credits change the picture slightly.

With franking credits taken into account, Telstra’s payout grosses up to about 6.33% and APA’s to roughly 6.11%, while VHY reaches 5.5%.

The blended grossed-up yield is close to 5.98%, which brings the capital requirement down to about $2.01 million.

Whether you can actually use those credits depends on your marginal tax rate, and for many retirees in pension phase they are refundable in full.

Why these ASX dividend shares and not the banks

The instinct for most income investors is to buy the big four and stop thinking.

Commonwealth Bank of Australia (ASX: CBA) currently yields 3.21%.

At that rate, $120,000 a year would require $3.74 million.

Telstra and APA are not more exciting businesses than the banks, but they pay materially more per dollar invested.

APA in particular has now raised its distribution for 22 consecutive years, which matters more than any single year’s yield.

A payment growing at 1.7% a year, as guided for FY27, is not inflation-beating on its own.

Combined with reinvestment, though, it compounds into something serious across two decades.

What could go wrong

Yield is never a promise.

Telstra shares have fallen 7% over the year, so a stable dividend has still meant a weaker total return.

APA carries substantial debt, which is the standard trade-off in regulated infrastructure and becomes more expensive if the Reserve Bank raises the cash rate on 29 September.

Foolish takeaway

Nobody reaches $10,000 a month in a single step.

The realistic path is contributing consistently, reinvesting every distribution, and letting two decades do the work.

A $2 million portfolio sounds impossible until you model it as thirty years of steady contributions inside a growing market.

These three holdings would form a sensible core for that portfolio.

For anyone building toward that number, ASX dividend shares remain the most straightforward income engine on the local market.

The post How to earn $10,000 in passive income a month with these ASX dividend shares appeared first on The Motley Fool Australia.

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Motley Fool contributor Mark Verhoeven 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 positions in and has recommended Apa Group and Telstra Group. The Motley Fool Australia has recommended Vanguard Australian Shares High Yield ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Telstra Group Ltd (ASX: TLS) and TPG Telecom Ltd (ASX: TPG) both sit at the heart of Australia’s telecommunications market.

For me, though, the choice is fairly clear.

If I were buying one today with a medium to long-term view, I would choose Telstra.

Telstra shares

The main reason I prefer Telstra is the strength of its core mobile business.

Australians rely heavily on mobile and internet connectivity, and Telstra has spent years investing in the network, spectrum, and infrastructure needed to maintain a leading position.

I like that combination of essential demand and an established competitive advantage.

Telstra also does not need rapid growth to produce a worthwhile result for shareholders. If it can keep customers, gradually increase earnings, and continue lifting its dividend, I think the investment case works well.

The current forecasts support that view. Consensus estimates point to earnings per share of 20.8 cents in FY27 and 21.6 cents in FY28.

Fully franked dividends are forecast at 22 cents and 22.5 cents per share, respectively. That equates to a forward dividend yield of around 4.8% in FY27 and 4.9% in FY28, before considering franking credits.

For me, Telstra shares offer a fairly easy investment case to understand: strong mobile positioning, recurring demand, and attractive income.

TPG Telecom shares

TPG also has plenty going for it. The company owns established telecommunications brands and serves a large base of Australian mobile and broadband customers.

There is also the possibility of stronger earnings ahead. Consensus forecasts put earnings per share at 1.8 cents in FY26 before increasing to 4.4 cents in FY27.

The income forecasts initially look even more eye-catching. TPG is expected to pay dividends of 20 cents per share in FY26 and 22 cents per share in FY27.

At a share price of around $3.79, that represents forecast dividend yields of around 5.3% in FY26 and 5.8% in FY27.

But I would be cautious about reading too much into those numbers. The gap between forecast earnings and dividends makes the income story less straightforward than Telstra’s. I would want greater confidence in the sustainability of those payments before choosing TPG primarily for passive income.

TPG may still reward investors from here, particularly if earnings recover strongly. I simply think Telstra shares give me a clearer long-term proposition today.

Foolish takeaway

This comparison comes down to which business I would feel more comfortable owning through the next several years.

For me, that is Telstra. Its leading mobile position, resilient demand, forecast earnings growth, and fully franked dividends give me more confidence in both the business and the income outlook.

TPG could still perform well, but I would put my money behind Telstra shares first.

The post Better buy: Telstra vs TPG Telecom shares appeared first on The Motley Fool Australia.

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