ASX dividend shares with large dividend yields could be really appealing for investors who want to receive a good amount of return through the cash flow. I'm going to talk about two stocks with large potential yields.
A large yield isn't the only thing I want to see from an ASX dividend share. Ideally, an appealing business will be able to grow earnings over the long term. I'd be wary of a business with a large yield if the profit is about to sink, that's why it's good to look further ahead than the current financial year.
So, below are two stocks that are projected to grow their dividend.
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Shaver Shop Group Ltd (ASX: SSG)
Shaver Shop operates in Australia and New Zealand as a specialty retailer of male and female personal grooming products and wants to be the leader in "all things related to hair removal".
It currently has more than 120 stores where it aims to sell a wide range of quality brands at competitive prices. Its large presence in Australia means it can negotiate exclusive products with suppliers. The business also sells various products across oral care, hair care, massage, air treatment and beauty categories.
Things are looking positive for the company, with the growth of the populations in Australia and New Zealand, as well as the long-term growth of the store count. In the period of 1 January 2024 to 22 February 2024, total sales were up 0.9% year over year, despite the difficult economic conditions.
Impressively, the business has grown its annual dividend every year since it started paying in 2017. According to Commsec, the ASX dividend share is projected to pay a grossed-up dividend yield of 12.6% in FY26.
Inghams Group Ltd (ASX: ING)
Ingham's was founded over 100 years ago and has since become the largest integrated poultry producer in Australia and New Zealand.
It supplies a number of major customers like supermarkets, quick service operators, foodservice distributors and wholesalers. Ingham's also has strong market positions in Australian turkey, Australian stockfeed and the New Zealand dairy feed industries.
The FY24 first-half result saw a big recovery in profit. Core poultry volume rose 2.2% to 240.8kt, revenue rose 8.7% to $1.64 billion, underlying earnings before interest, tax, depreciation and amortisation (EBITDA) rose 19.9% to $252.1 million, underlying net profit after tax (NPAT) grew 134.2% to $62.3 million and the dividend was increased by 166.7% to 12 cents per share.
The ASX dividend share's profit is expected to keep rising in the coming years – though not at a triple-digit pace – which can help push the dividend payments higher.
According to Commsec, the company is expected to pay an annual dividend per share of 24.1 cents in FY26, which could translate into a grossed-up dividend yield of 9.6%.
