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2 FTSE 100 Passive Income Shares I’d be confident about going ‘all in’

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The FTSE 100‘s home to a variety of popular passive income stocks. It’s packed with companies with multiple revenue streams, leading market positions and strong balance sheets. These qualities in turn give them the ability to pay a decent and usually growing dividend.

But the outlook for many popular income stocks is turning bleaker. Shell‘s long-term dividend record, for example, is under threat as renewable energy steadily gains the upper hand. For LloydsThe rise of challenger banks and structural problems for the UK economy create colossal problems in the future.

2 top dividend stocks

Still, there are plenty of other top stocks for investors to consider today. To take Legal and general group (LSE:LGEN) and Bunzl (LSE:BNZL), for example. I believe they can deliver exceptional long-term returns through a combination of dividend income and price gains.

It’s never a good idea to buy just one or two stocks. A lack of diversification significantly increases the risk for investors. But if I were to go “all in” and spend all my money on just a few Footsie shares, I’d choose these two. This is why.

Brilliant overall

Legal & General’s share price has struggled to gain traction in recent years. But I expect the economy to gain strength in the future, thanks to favorable demographic factors.

In Britain, the number of people aged 75 and over is expected to double to 10 million between now and 2039. The rapid growth in the number of elderly people is a phenomenon observed all over the world.

This has the potential to steadily increase profits at Legal & General. It will have to paddle hard to thrive in a fiercely competitive market. But demand for pension, wealth and protection products could still increase as people grow older.

I like Legal & General as a passive income stock because of its stunning cash generation. This has laid the foundation for long-term dividend growth, as shown in the chart below, and for market-beating returns.

Legal & General's dividend history.
Chart created with TradingView

Dividends are never guaranteed. But City analysts expect dividends to continue rising for the foreseeable future. This results in huge returns of 9.1% and 9.6% for 2024 and 2025 respectively.

Astonishing dividend growth

Bunzl is another FTSE share with a stunning record of dividend growth. Annual payouts have increased for 31 years in a row, including 8.9% most recently in 2023.

This reflects the essential role our products play in everyday society. The wide range of goods – from food packaging and medical gloves to cleaning products – are in high demand, regardless of economic conditions.

As a result, Bunzl’s predictable cash flows and excellent earnings visibility, and thus the means to reliably increase dividends, belong to Bunzl. This allows investors like me to reduce the impact of rising inflation on our returns.

The downside is that the company’s acquisition-based growth strategy produces nasty surprises. For example, unexpected costs can have a major impact on profits.

But fortunately, Bunzl has an excellent history of identifying acquisitions and integrating them into the wider group. That’s why the company is one of the most reliable profit producers out there.

Like Legal & General, this is a stock I would happily invest a large chunk of money in at the next opportunity.