How much to invest in these ASX stocks to generate $100 as passive income monthly?

Key Takeaways:

1. Dividend stocks are an important source of passive income. Investors get benefitted via dividend and capital appreciation.

2. Coles and Rio Tinto are two popular dividend stocks in Australia.

Dividend stocks are an important source of passive income. Dividend stocks are those stocks profits investors in the form of dividend and capital appreciation. When it comes to choosing a high-quality dividend stock, investors prefer choosing stocks that provide consistent dividend and are consistent in terms of growth in the percentage of dividend.

Besides, dividend stocks also help in enhancement in investment portfolio and are also less susceptible to market volatility as they are not entirely dependent on major economic cycles.

Coles Group Limited (ASX: COL)

Australian retailer Coles Group has consistently provided dividend since 2019. The Company made its ASX debut on 21 November 2018. COL is amongst the most trusted brands in Australia and it delivered several DROPPED & LOCKED’ prices to help keep inflation below the national average, a better Flybuys program, as well as free glassware in Supermarkets, together with the popular Price Drops campaign in Liquor.

In 1H FY2023, Coles total sales revenue increased by 3.9% to AU$20.8 billion. The Company’s net profit for the period was AU$616 million, up 11.4% on previous corresponding period

The Company declared an interim dividend of 36 cents in 1H FY2023. It paid AU 30 cents in 2H FY2022. Thus in 2022, the total dividend paid by the Company was AU 66 cents.

Now, in order to earn AU$100 per month from this stock or AU$1200 annually, one should have 1818 shares of the Company. The number is calculated by dividing the amount you wish to earn annually by the dividends announced by the Company in 2022.

RIO Tinto Limited (ASX: RIO)

RIO Tinto, the producer of copper, gold, iron ore, coal, aluminium, borates, titanium dioxide and other minerals and metals is also a popular dividend stock with history of constantly providing dividends from 2013.

In FY2022, the Company announced total dividend of US 492 cents. Final dividend announced by the Company is US 225 cents. The shareholders may opt to receive theirs in pounds sterling or NZD. Currency conversions will be based on the pound sterling, Australian dollar and New Zealand dollar exchange rates 5 business days before the payment date.

To get US$100 a month from this stock or US$1200 annually, the shareholder should have 244 shares of the Company.

In FY2022, the Company’s revenue decreased by 36% to US$16,134 million compared to FY2021. Net profit also declined by 30% to US$12,420 million.

The uplift in RIO operational performance, strengthening of external relationships along with the investment in the long-term strength of the business would help the Company to continue to pay attractive dividends and invest in sustaining as well as growing the portfolio, while contributing to society's drive to net zero.

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