There are a lot of ASX dividend stocks to choose from on the Australian share market.
But one for income investors to watch closely could be Accent Group Ltd (ASX: AX1).
Not only does the footwear focused retailer offer a very generous dividend yield today, but it has been tipped to continue increasing its dividend meaningfully in the coming years.
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Here's what you need to know about this ASX dividend stock
Just 10 years ago, the HypeDC and The Athlete's Foot owner was paying investors a 5 cents per share fully franked dividend.
But thanks to the popularity of its retail brands and management's relentless store rollouts, this year the company has been tipped to be in a position to pay more than double this amount.
But if you thought the growth was going to slow, think again. Analysts are then expecting a dividend over triple what it paid 10 years ago in FY 2026.
Dividend forecast
Let's take a look now at what analysts at Bell Potter are forecasting from this ASX dividend stock in the coming years. The broker expects:
- FY 2024
- Underlying NPAT of $77.9 million
- Dividends per share 11.1 cents
- FY 2025
- Underlying NPAT of $91.8 million
- Dividends per share 13 cents
- FY 2026
- Underlying NPAT of $109.9 million
- Dividends per share 15.6 cents
Based on the current Accent share price of $2.02, this will mean fully franked dividend yields of 5.5%, 6.4%, and 7.7%, respectively.
But the returns won't stop there. Bell Potter currently has a buy rating and $2.35 price target on this ASX dividend stock. This implies over 16% upside for investors from current levels over the next 12 months.
If we add in the forecast dividends for FY 2024, the total 12-month potential return increases to almost 22%. The broker commented:
We continue to view AX1 as a relative preference in our retail sector coverage given the company's scale & exposure in terms of channels, brands & size as the overall industry navigates a challenging retail spend environment in addition to growth adjacencies via exclusive partnerships with globally winning brands such as Hoka and growing vertical brand strategy (~8% on owned sales).
