A FTSE 100 dividend share I’d buy for long-term passive income!

I don’t have unlimited cash reserves to invest in UK stocks. But BAE system (LSE:BA.) is a FTSE 100 dividend stocks I like to add to the portfolio, when I have money to invest.

The defense giant is one of the largest indexes in 2022. Its value has increased by 57% as the war in Ukraine has led to expectations of disarmament of the surrounding countries.

I believe that BAE Systems’ profits will grow strongly as the importance of strong defense increases among Western countries. This means that businesses can also be a strong option for long-term passive income.

Multiple threats

Last year’s Russian invasion highlighted the growing geopolitical landscape. But the Kremlin’s foreign policy is not the only thing that worries BAE Systems’ main customers.

China has long been a concern for the US and UK. In particular, fears about his intentions for Taiwan and his expansion in the South China Sea have gripped Western governments. Chinese balloon shootings in North America this month are raising temperatures.

On top of this, speculation about the military intentions of North Korea and Iran continues to be a concern. Meanwhile, the drive to eradicate global terrorism continues.

These factors helped push total global arms spending to record a record high of $2trn by 2021, according to the Stockholm International Peace Research Institute. Another substantial annual increase is anticipated for 2022 when the body next reports in the spring.

Solid results

BAE Systems’ bumper full-year results reinforce expectations of another big jump in annual spending.

In 2022, the company achieved a record order book of £37.1bn, a result that brought the order backlog to £58.9bn. This includes a bumper contract to build five more Type 26 frigates for the Royal Navy.

For chief executive Charles Woodburn, demand for ships, submarines, aircraft and other hardware will also increase. He told investors that “we expect continued momentum in the medium to long term as the government replenishes stocks, recapitalizes equipment and supports allies.”

Revenue, underlying earnings and free cash flow were all good at BAE Systems last year. And this – combined with a strong market outlook – has led the company to lift its annual dividend to 27p. This is up almost 8% annually.

Bottom line

Earnings at BAE Systems have suffered in the past due to project delays. But the business is still proving a reliable long-term profit generator. And this has paved the way for an impressive long-term dividend policy.

The business has raised its annual payout for 19 years straight. This underscores the resilience of defense spending despite a deep economic crisis. And it reflects the strength of the relationship he built with the Pentagon’s top spenders and the Defense Department.

BAE Systems could be one of the best FTSE stocks to buy for reliable dividend growth. And I believe now could be a good time to add to my portfolio.