Is this the best ASX 300 share for big dividend payouts?

This stock could really get a portfolio's dividends up and running.

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There are a number of S&P/ASX 300 Index (ASX: XKO) shares that offer very large dividend yields. I'm going to look at whether Accent Group Ltd (ASX: AX1) is a great option for large passive income.

This is an ASX retail share that sells a wide variety of shoes through different businesses including The Athlete's Foot, Platypus and Stylerunner. It also acts as the distributor for a number of global shoe brands including Skechers, Ugg, Vans, Henleys, Hoka, Kappa and plenty more.

The ASX 300 stock is very cheap

Accent usually trades on a very low price/earnings (P/E) ratio, which means it trades on a low multiple of its profit.

Retailers usually trade on a lower P/E ratio compared to some other sectors such as ASX tech shares or defensive ASX shares.

If we look at the chart below, we can see the Accent share price has become cheaper over the past few months, which pushes up the dividend yield.

According to Commsec, the ASX 300 share could generate earnings per share (EPS) of 11.7 cents in FY24 and 16 cents in FY26.

Those numbers would put the current Accent share price at 16x FY24's estimated earnings and 12x FY26's estimated earnings.

Large dividend

A dividend yield is dictated by two factors – the P/E ratio and the dividend payout ratio.

I've already shown how Accent trades on a relatively low earnings multiple. It's projected to pay a generous amount of its profit as a dividend. Estimates on Commsec suggest the Accent dividend payout ratio could be 98.3% in FY24 and 88% in FY26.

These payouts would translate into a grossed-up dividend yield of 8.7% in FY24 and 10.6% in FY26.

Ultimately, it's up to the company's board to decide what the dividend payment will be for shareholders, with an eye on the profit generated.

Can Accent's earnings and dividend grow beyond FY24?

I think there are three useful drivers for the ASX 300 share in FY25 and beyond.

First, at some point, I believe retail conditions can improve in the Australian economy.

Second, the company continues to roll out new stores across various brands. In the first half of FY24, it opened 72 new stores and it's planning to open another 20 new stores in the second half.

Third, it can acquire new businesses or work with an extra global brand.

I'm excited about the future of the business and its potential dividends. It may not be the most reliable dividend, but I think its passive income is quite likely to be very large over the next few years if the economy improves. Is it the best ASX 300 share for big income? I'd like to buy the beaten-up retailer right now. I'd be less certain about future ASX mining share dividends because of the volatility of commodity prices (which can fall).

Motley Fool contributor Tristan Harrison has positions in Accent Group. The Motley Fool Australia's parent company Motley Fool Holdings Inc. 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 Scott Phillips.

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