Top 5 ASX Dividend Stocks to Buy Now for Steady Yields in 2025

In a world where markets continue to flirt with volatility, steady income from dividend-paying stocks has never looked more attractive. For investors on the ASX, the hunt for reliable dividend income in 2025 points to a select group of companies offering stability, proven cash flows and, most importantly, a strong history of rewarding shareholders. But which stocks actually deliver?

We’re not talking about speculative darlings promising the moon; we’re talking about grounded, fundamentally sound businesses that continue to pay consistent dividends. In our view, these five ASX-listed stocks are worth a close look for income-seeking investors this year.

 

Why Focus on Dividend Stocks in 2025?

Dividend stocks return a portion of profits to shareholders in the form of regular payments. For retirees, conservative investors or anyone seeking passive income, they act as a buffer against the volatility of pure growth stocks. This year, dividend stocks are again in the spotlight thanks to persistent inflation concerns, global rate uncertainties and questions around economic growth.

According to the ASX 2024 Investment Report, more than 50% of retail investors in Australia cited dividend yield as a key factor in their equity decisions. That trend is unlikely to reverse any time soon.

So, which ASX companies are likely to continue paying—and possibly increasing—dividends in 2025?

 

Commonwealth Bank of Australia (ASX: CBA)

• Dividend Yield: ~2.5%–2.7%
• Payout Ratio: ~79%
• 2024 Dividend: $4.65 per share (fully franked)

Commonwealth Bank, in our view, continues to anchor many dividend portfolios—and for good reason. As one of the Big Four banks, its exposure to Australia’s housing and personal-finance market gives it a strong moat. Despite rising competition in the digital-finance sector, CBA’s robust profitability and large capital buffer help ensure continued payouts.

In FY24, CBA returned more than $10 billion in dividends and share buy-backs to its investors. While loan growth may cool slightly under higher interest rates, we believe its ability to price risk effectively and maintain solid net-interest margins leaves room to keep delivering fully franked dividends.

What’s more, the bank has invested heavily in digital infrastructure, positioning itself for long-term cost reductions and customer retention. Investors looking for reliability in uncertain times would do well to keep CBA on their radar.

 

BHP (ASX: BHP)

• Dividend Yield: ~4.3%–5.3%
• Payout Ratio: ≈ 50% of earnings
• 2024 Dividend: US$0.50 per share interim (≈ A$0.75)

BHP easily fits the bill when you’re after high yield with blue-chip credibility. The global mining giant—Australia’s largest by market capitalisation—continues to deliver strong dividends thanks to its exposure to iron ore, copper and metallurgical coal.

While commodity prices are cyclical, BHP’s disciplined capital allocation and diversified portfolio offer a strong buffer. In FY 2024, the company upheld its progressive dividend policy, returning more than US$6 billion to shareholders through interim and final payouts.

We think medium-term demand for copper and nickel remains robust, driven by electrification and the global green-energy transition, meaning BHP’s cash flows should stay healthy. Its strong balance sheet, low-cost operations and capital discipline make it a cornerstone for investors chasing yield without compromising on quality.

 

Telstra Group (ASX: TLS)

• Dividend Yield: ~3.85%
• Payout Ratio: ~97% based on underlying earnings and ~128% on statutory earnings
• 2024 Dividend: 18 cents per share (fully franked)

Telstra has staged a quiet comeback in the dividend-investing world. After years of stagnation due to the NBN rollout and declining legacy revenues, the telecom leader is finally showing hints of dividend growth.

Telstra’s transformation strategy—focusing on digitisation, cost reduction and enterprise expansion—has started to bear fruit. Its FY 2024 result showed underlying EBITDA up more than 7% while free cash flow reached A$3 billion.

With additional growth expected from 5G infrastructure and enterprise solutions, Telstra aims to maintain or lift its dividend, making it a solid option for income-focused investors in a defensive sector.

 

Washington H. Soul Pattinson (ASX: SOL)

• Dividend Yield: ~2.38%
• 2024 Dividend: 95 cents per share (fully franked)
• Payout Ratio: ~61% of earnings and ~55% of free cash flow

Soul Patts may not top the yield charts, but it stands out for its record of increasing dividends over time—something few companies can claim.

Unlike typical industrials or banks, Soul Patts operates as an investment conglomerate with holdings in telecommunications (TPG), energy, building materials and pharmaceuticals. This diversification has helped it outperform the ASX 200 over the past two decades while steadily growing its dividend.

Thanks to its low correlation with traditional sectors and counter-cyclical strategy, SOL offers stability and upside potential for investors who prioritise long-term dividend growth over headline yield.

Just as a side note, it is expected to merge with Brickworks in the coming months.

 

Transurban Group (ASX: TCL)

• Dividend Yield: ~4.35%
• Franking Level: Unfranked
• Payout Ratio: The payout ratio is exceptionally high at about 2,560%, indicating dividends are not covered by accounting earnings.

Infrastructure may not be glamorous, but it’s often where the smartest money goes for reliable income. Transurban, which operates monopoly toll roads (mostly in Sydney) is one of Australia’s best examples.

We believe Transurban offers a compelling combination of inflation-linked revenue and high cash-flow certainty. Its assets are defensive by nature—people still drive, even during economic slowdowns—and many toll increases are contractually tied to CPI. That makes TCL an appealing hedge in an inflationary environment.

In 2024, management guided to a 6% rise in distributions, supported by traffic recovery and new projects. While its yield isn’t franked, the cash component remains attractive to income investors, especially those using SMSFs or other low-tax vehicles.

 

Final Thoughts: How to Pick the Right Dividend Stock in 2025

It’s one thing to chase high yields; it’s another to ensure those dividends are sustainable. In 2025, the ideal ASX dividend stock should demonstrate:

• strong, predictable cash flows
• Sensible payout ratios that match earnings capacity
• sector resilience in the face of economic shocks
• capacity for modest dividend growth over time

Each of the five stocks above ticks these boxes to varying degrees. Your ultimate choice depends on your broader portfolio goals—some investors may prioritise BHP’s yield, others CBA’s reliability, while many favour Soul Patts for its growth trajectory. Dividend investing isn’t just about what you earn today; it’s about the income stream you’ll rely on for years to come.

 

What are the Best ASX Stocks to invest in right now?

Check our buy/sell tips

FAQs

• Are dividends from ASX stocks fully taxable in Australia?

  Dividends in Australia can be partially or fully franked, meaning tax has already been paid at the corporate level. Investors receive a franking credit, which can reduce their own tax liability depending on their marginal rate.

• How often do ASX-listed companies pay dividends?

  Most pay twice a year—an interim dividend after half-year results and a final dividend after full-year results. Some REITs and infrastructure firms distribute quarterly.

• Is it better to invest in high-yield or high-growth dividend stocks?

  That depends on your goals. High-yield stocks deliver income now, while growth-oriented dividend stocks may provide rising income and capital gains. Many investors hold a mix of both.

• Can dividend stocks fall in price even if they keep paying dividends?

  Yes. Share prices can drop due to company-specific issues, market sentiment or macroeconomic shocks, even when dividends remain intact. Evaluating fundamentals—not just yield—is crucial.

• What’s a healthy payout ratio to look for?

  Generally 50%–80%. A ratio above 100% means a company is distributing more than it earns, a practice that is rarely sustainable over the long term.