This high-yield ASX share could pay a dividend yield of almost 14% in FY25!

This stock could continue to be a fountain of cash.

| More on:
Young girl with green hair and big bow dancing with joy

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Shaver Shop Group Ltd (ASX: SSG) is projected to pay a grossed-up dividend yield of 14%. That's a high-yield ASX share, and it could be very rewarding.

This ASX retail share has a store count of more than 120 across Australia and New Zealand. It aims to sell a "wide range of quality brands, at competitive prices, supported by excellent staff product knowledge". And it aims to "negotiate exclusive products with suppliers".

While its core product range comprises electric shavers, clippers and trimmers, and wet shave items, Shaver Shop also sells oral and hair care, massage, air treatment and beauty categories.

How big is the Shaver Shop dividend going to be?

Firstly, a reminder that dividend payments are not guaranteed, unlike interest paid by a bank term deposit.

Second, the company board declares a dividend influenced by how much profit/cash flow a business is making.

I think Shaver Shop has demonstrated an impressive dividend track record. It has increased its dividend every year since 2017, when it first started paying one.

In FY23, the high-yield ASX dividend share increased its dividend by 2% to 10.2 cents per share. This currently translates into a grossed-up dividend yield of 14.3%.

The current forecast on Commsec is that Shaver Shop will pay a reduced dividend per share of 9.7 cents in FY25. That would be a grossed-up dividend yield of 13.7%.

How could the company's earnings perform?

Shaver Shop recently announced its total sales were down 5.3% in the first four months of FY24. But compared to pre-pandemic trading in FY20, total sales were up 23.8%. It also said its gross profit margin was "broadly consistent" with the prior comparative period.

In the short term, the company is investing more in refitting and relocating stores where it thinks there are attractive commercial returns.

It said while the current retail environment was "uncertain", Shaver Shop remained "extremely well-positioned with a unique, value and service-oriented offering" for its customers.

In terms of the price/earnings (P/E) ratio, the high-yield ASX share is projected to generate 12 cents of earnings per share (EPS). This would represent a fall in profit. But it'd still be a single-digit P/E ratio of under 9, which could be very cheap.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Dividend Investing

Man holding out Australian dollar notes, symbolising dividends.
Dividend Investing

Buy these high-yield ASX shares for major passive income in 2025 and beyond

Let's see why analysts think these shares could be great buys for income investors.

Read more »

A happy elderly woman smiles and cheers as she looks at good investment news on her laptop.
Dividend Investing

2 ASX dividend champions that never cut payouts

These two dividend stocks have consistently rewarded investors. 

Read more »

Happy couple enjoying ice cream in retirement.
Dividend Investing

Aiming for rock-solid retirement income? I'd buy these two ASX shares

These stocks offer compelling levels of income for retirees.

Read more »

Australian dollar notes in the pocket of a man's jeans, symbolising dividends.
Dividend Investing

Invested in ASX MOAT or other VanEck ETFs? It's dividend day!

Show us the money!

Read more »

A couple working on a laptop laugh as they discuss their ASX share portfolio.
Dividend Investing

Here are 2 ASX income stocks with yields above 7%

These businesses are providing investors with significant income.

Read more »

Man holding fifty Australian Dollar banknote in his hands, symbolising dividends, symbolising dividends.
Dividend Investing

Want passive income? Check out these ASX dividend shares

Analysts think these shares could be perfect for passive income investors.

Read more »

A couple stares at the tv in shock, with the man holding the remote up ready to press a button.
Dividend Investing

Why Macquarie expects this high-yielding ASX All Ords stock to charge higher AND boost its dividends

Looking for a quality ASX dividend share with strong growth potential? Read on!

Read more »

A miner in a hardhat and high visibility clothing makes a thumbs up symbol.
Resources Shares

4 reasons to buy Rio Tinto shares today

A leading expert forecasts strong growth potential for Rio Tinto shares.

Read more »