I'm considering buying 600 shares in this ASX 200 dividend gem to target $332 a month in passive income!

This ASX 200 passive income gem has a lengthy track record of paying two fully franked dividends a year.

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With an eye on bringing in some handy extra passive income, I'm considering buying a high-yielding S&P/ASX 200 Index (ASX: XJO) dividend stock.

One that I believe will continue to deliver reliable and even increasing passive income in the years ahead.

The company in question is ASX 200 mining stock Rio Tinto Ltd (ASX: RIO).

Now I don't own any Rio Tinto shares at the moment. And with the 18% year to date share price retrace in mind, I'm glad I've been patient.

But after closing down 2.59% at $112.43 a share yesterday, I believe the worst of the selling is likely over for the ASX 200 miner. That's coupled with my belief that commodity prices, including iron ore and copper, look to be finding a floor at current levels after some sharp falls in 2024.

On the passive income front, Rio Tinto has a lengthy track record of paying two fully franked dividends a year for more than a decade.

And I was pleasantly surprised by the miner's half-year results, reported on 31 July.

Highlights included sales revenue of US$26.80 billion for the six months, up 1% year on year. And underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) were up 3% to US$12.09 billion.

This saw management declare a fully franked interim dividend of $2.70 a share. That's up 3.5% from the FY 2023 interim dividend of $2.61 a share.

Unfortunately, it's a bit too late to grab this latest passive income payout. Rio Tinto shares trade ex-dividend today. Investors who owned the stock at market close yesterday can expect to receive their payout on 26 September.

$3,978 a year in passive income from Rio Tinto shares

Before we dig into the maths, two important points.

First, take note that the yields you generally see quoted are trailing yields.

While I expect Rio Tinto's dividend payouts to hold up well in the year ahead, future yields can be higher or lower than trailing yields depending on a range of company-specific and macroeconomic factors.

Second, while I'm looking specifically at Rio Tinto shares here, a proper passive income portfolio will include a range of dividend stocks operating across various sectors and geographic locations. That kind of diversification will help to lower the overall risk of my income stream taking a large, unexpected hit.

Returning to those dividends, Rio Tinto paid a final dividend of $3.93 a share on 18 April. As mentioned above, the interim dividend of $2.70 per share will hit investors' bank accounts on 26 September.

All told, that equates to a full-year passive income payout of $6.63 a share. At yesterday's closing price, Rio Tinto shares trade on a 5.9% fully franked trailing dividend yield.

According to my trusty calculator, 600 Rio Tinto shares should earn me $3,978 in dividend payouts over 12 months.

Or a very handy $331.50 of passive income per month.

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 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.

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