Best dividend growth stocks

Investing in companies that consistently increase their dividend payouts can be highly lucrative because growing dividends can compound over time and are often a sign of strong business quality and sustainable long-term earnings growth.

Commonwealth Bank of Australia (ASX: CBA) 

is one of the best dividend growth stocks with an annual dividend yield of 3.06% on the ASX due to its leading market position along with strong balance sheet and proven track record of shareholder distributions over time.

The bank during the March 2026 quarter generated unaudited cash NPAT of approximately $2.7 billion which was up 4% from the prior corresponding period while lending and deposit volumes increased across key business segments.

Its financial position is robust with a CET1 capital ratio of 11.6% while customer deposits accounted for 79% of total funding and liquidity ratios stayed comfortably above regulatory requirements.
Recent progress has been impressive as CBA expanded its artificial intelligence capabilities along with business banking relationships and added more than 170,000 retail transaction accounts during the quarter.

The outlook is attractive because home loan balances rose by $41.2 billion and household deposits increased by $38.3 billion over the past year and CBA is well placed to increase dividend payments over time.

Wesfarmers Limited (ASX: WES) 

is one of the best dividend growth stocks on the ASX due to its portfolio of phenomenal businesses and a long history of dividend payouts.
The company in its FY26 half year result reported revenue of $24.2 billion which was up 3.1% from the prior corresponding period while NPAT increased 9.3% to $1.6 billion and EBIT rose 8.4% to $2.5 billion.

Wesfarmers increased its fully franked interim dividend by 7.4% to $1.02 per share and also maintained a strong return on equity of 32.7%.

Recent progress has been good as the group has accelerated investment in artificial intelligence, digital transformation, omnichannel retail and supply chain modernisation through strategic partnerships with Microsoft and Google Cloud which support long-term productivity improvements.
The current annual dividend yield is 3.21% and with a portfolio of strong businesses across retail, healthcare, industrials and chemicals positions Wesfarmers to increase shareholder payouts over time.

Transurban Group (ASX: TCL) 

is one of the best dividend growth stocks on the ASX because it owns essential toll road infrastructure assets that continue to generate resilient traffic growth and cash flows linked to inflation.
The company's latest FY26 March quarter update showed that average daily traffic across the group increased 3.0% year-on-year while total traffic reached 2.54 million daily trips.

Melbourne traffic received support from the opening of the West Gate Tunnel whereas the North American assets continued to record strong growth in utilisation.

Major expansion projects across Sydney, Melbourne and North America are advancing well which supports the long-term outlook by adding capacity and creating new revenue growth opportunities.
More than 90% of Transurban's revenue is linked to CPI or fixed escalators and with a current annual dividend yield of 4.55% along with a growing traffic base, the company is well placed to grow distributions over time.

(Source: Company Announcements)