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This fantastic ASX dividend share will help you beat low interest rates

A hand moves a building block from green arrow to red, indicating negative interest rates
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On Tuesday the Reserve Bank will meet to discuss the cash rate once again. According to the latest cash rate futures, the market is pricing in a 69% probability of a rate cut to zero.

Whether this transpires or not, time will tell. But one thing that is for sure, is that it will be a long time before interest rates return to normal levels again.

In light of this, the share market looks like it will remain the best place to earn a passive income for a while yet.

Fortunately, there are plenty of dividend shares out there with generous yields. One to consider buying is as follows:

Accent Group Ltd (ASX: AX1)

Accent is the leading leisure footwear retailer behind retail brands such as HYPEDC, The Athlete’s Foot, and Platypus brands.

Last week it released its half year results and revealed solid increases in sales and profits. Accent reported a 6.6% increase in total sales to $541.3 million and 57.3% lift in net profit after tax to $52.8 million. The latter was its seventh consecutive half year of record profit. It was driven by strong like for like and online sales growth and the opening of new stores.

This positive form allowed the Accent board to increase its interim dividend by 52% to 8 cents per share.

Looking ahead, analysts at Morgans expect the company to declare a final dividend of 4 cents per share in August. This will bring its full year dividend to a fully franked 12 cents per share. Based on the Accent share price, this will mean a 5.5% yield.

While Morgans only has a hold rating on its shares, its price target of $2.60 is 20% higher than the current Accent share price of $2.16. This could potentially mean an upgrade on valuation grounds isn’t far away.

In the meantime, Citi is positive on the company. It has a buy rating and the same price target of $2.60 on its shares. Citi is currently forecasting an 11 cents per share dividend in FY 2021.

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Returns As of 15th February 2021

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Accent Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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