1 fantastic ASX dividend stock down 25% to buy now

One leading broker thinks that this beaten down dividend stock is a buy.

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The last 12 months have not been kind to the ASX dividend stock in this article.

During this time, its shares have fallen 25% from their 52-week high and now sit within touching distance of a 52-week low.

Which ASX dividend stock?

The dividend stock in question is Endeavour Group Ltd (ASX: EDV).

In case you're not familiar with Endeavour Group, it is the biggest player in alcohol retail in Australia.

The company notes that it is the owner of many well-recognised and trusted brands. This includes BWS and Dan Murphy's.

In total, it runs an omnichannel network of more than 1,675 stores, 344 hotels, and scalable digital platforms in its websites and apps.

Management also highlights that it has got leading in-house brands and production capability in its Pinnacle Drinks business, as well as a large, growing, and highly engaged customer base. This includes over 4.5 million active My Dan's members.

What's gone wrong?

The cost of living crisis has hit this ASX dividend stock hard. It seems that with consumers trying to save what they can, they have been going for budget options or items on promotion when possible.

This has weighed on retail margins and the company's profits.

However, it is worth noting that this isn't isolated to Endeavour Group. The rest of the industry has been hurting as well.

But the good news is that with rate cuts likely to be on the way very soon, consumer spending could be about to improve markedly. This bodes well for Endeavour Group and its huge network of stores.

Especially given that it appears to have been growing its market share during this downturn. In fact, it is partly for this reason that Goldman Sachs thinks that Endeavour Group is an ASX dividend stock to buy. It recently said:

Net net, we reiterate Buy on our continued believe in a high quality retailer gaining share amid a category down-cycle with a resilient growth option in Hotels. Company is trading at FY25 P/E of 17x vs historical average of 22x and WOW 22x, COL 21x. Next catalyst: post Xmas trading at 1H25 results.

As mentioned above, the broker has a buy rating on its shares. And with a price target of $5.10, it believes this ASX dividend stock could rise 21% from current levels.

In addition, Goldman believes that some attractive (and growing) dividend yields are on the way for investors.

It is forecasting fully franked dividends per share of 19 cents in FY 2025, 22 cents in FY 2025, and 24 cents in FY 2026. Based on its current share price of $4.20, this equates to dividend yields of 4.5%, 5.2%, and 5.7%, respectively.

All in all, this could make Endeavour Group an ASX dividend stock to buy before the tide turns.

Motley Fool contributor James Mickleboro has positions in Endeavour Group. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended Coles Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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