Receiving passive income from ASX shares can be very rewarding. How easy is it to watch the cash hit your bank account every year – no effort at all! Some businesses are known for growing their dividend payouts, while others can offer large dividend yields.
When businesses are paying out a lot of their profit, they aren't reinvesting significantly for long-term growth. So, don't expect tons of capital growth from stocks with large dividend yields. However, dividend payments can be less volatile than share prices, which some investors may like.
The two high-yield ASX shares below are expected to grow their dividend payouts in FY25 and FY26. However, a tough retail environment could mean FY24 (which has just finished) results could see a dividend reset.
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Shaver Shop Group Ltd (ASX: SSG)
This ASX retailer sells male and female grooming products and wants to be the market leader in 'all things related to hair removal'. It has 123 stores across Australia and New Zealand and also sells products through its own websites and other online marketplaces.
It aims to offer customers a wide range of quality brands at competitive prices, supported by "excellent staff product knowledge". The company's scale enables it to negotiate exclusive products with suppliers. For example, it recently secured exclusive rights to distribute and sell Skull Shaver's full range of products across Australia and New Zealand.
It also retails products across oral care, hair care, massage, air treatment and beauty categories.
Impressively, the high-yield ASX shares grew their dividend every year between FY17 and FY23, so the company has a strong commitment to rewarding shareholders.
According to the estimates on Market Screener, the business could pay a grossed-up dividend yield of 11.8% in FY25 and 12.2% in FY26.
Accent Group Ltd (ASX: AX1)
Accent is an ASX retail share that sells a wide variety of shoes. It acts as a distributor for a number of global shoe brands, including CAT, Dr Martens, Henleys, Herschel, Hoka, Kappa, Merrell, Skechers, Ugg and Vans.
The business also has several of its own brands, including Trybe, The Athlete's Foot, Stylerunner, Platypus, Glue Store, and Nude Lucy.
Shoe retailing is not the most defensive industry in the world. Accent's partnerships with global brands are not 100-year deals; they're quite short-term. As such, Accent normally trades on a low price/earnings (P/E) ratio, but this can result in a big payout from the high-yield ASX share.
After FY24, the business could see profitability recover as cost growth slows, the store rollout continues, digital sales grow, and more brands are potentially added to its portfolio.
The estimate on Commsec suggests Accent could pay an annual dividend per share of 14 cents in FY25 and 16 cents per share in FY26, translating into forward grossed-up dividend yields of 10.3% and 11.8%, respectively.
