As an ASX 200 bank share, investors are always going to expect big things when it comes to dividends from Westpac Banking Corp (ASX: WBC) shares. Westpac, along with the other members of the big four banks, has been paying relatively large dividends for decades.
As of today, this holds firm. Over the past 12 months, Westpac shares have given investors two dividend payments. The bank paid out an interim dividend worth a fully franked 61 cents per share back in June 2022.
Then, a fully franked final dividend worth 64 cents per share followed in December, for an annual total of $1.25 for 2022. Both of these payments were healthy increases over the interim and final dividends from 2021.
Together, these last two dividends give Westpac shares a trailing dividend yield of 5.22% right now (or 7.46% grossed-up with that full franking). That's based on the current Westpac share price of $23.94 (at the time of writing).
So is this dividend enough to make Westpac shares a buy today?
Image source: Getty Images
Is a big ASX 200 dividend enough to buy Westpac shares?
Well, for an income investor, that yield alone might be enough to get over the line. 5.22% is a relatively high yield by ASX standards (especially including the full franking).
And Westpac has always been one of the more solid dividend payers on the ASX. So, barring unforeseen events, investors probably don't have to worry about a massive cut to Westpac's dividend going forward.
But let's see what one of the ASX's expert investors reckons.
As my Fool colleague James covered last week, ASX broker Goldman Sachs has recently named Westpac as "the best big bank to buy right now". Goldman gave Westpac shares a buy rating, with a 12-month share price target of $27.6, largely thanks to optimism over Westpac's bold cost-cutting plan.
If realised over the next year, this would mean an upside of more than 15% in capital growth alone from the current price. That's pretty good news, considering Westpac shares have already risen by 11% over the past year:
But Goldman is also expecting Westpac to keep raising its dividend over the coming year or two as well. It is predicting a total of $1.484 in dividends per share for FY2023, rising to $1.60 per share in FY 2024.
This would indicate an interim dividend of 84.4 cents per share in June this year, and two dividends worth 80 cents per share following that.
So that's a lot of upside to look forward to if broker Goldman is on the money. We can't be certain if this is the case right now, of course. But this ASX expert clearly thinks Westpac shares are a buy today for the big dividend.
