It has been a very difficult 12 months for the ASX dividend stock in this article.
Since this time last year, its shares have lost approximately 35% of their value.
This compares unfavourably to an 11.2% gain by the ASX 200 index over the same period.
Which ASX dividend stock?
The stock we are looking at today is GQG Partners Inc (ASX: GQG).
It is an investment company that manages global and emerging market equity portfolios for institutions, advisors, and individuals worldwide.
Investors have been selling the company's shares due to the relatively poor performance of its investment strategies and their impact on its funds under management (FUM).
GQG Partners has been underperforming with its investment strategies after avoiding booming areas of the market because of valuation concerns.
While this is disappointing, it could have created a buying opportunity for income investors according to analysts at Macquarie Group Ltd (ASX: MQG).
Big dividend yields
Despite its investment underperformance this year, the team at Macquarie believes that the ASX dividend stock remains well-placed to grow its payouts over the coming years.
After paying 13.7 US cents per share in FY 2024, the broker expects an increase to 14.7 US cents in FY 2025. Based on current exchange rates at its latest share price of $1.76, this equates to a whopping dividend yield of 12.9%.
It then expects increases to 15.5 US cents per share in FY 2026 and 16.4 US cents per share in FY 2027. This would mean dividend yields of 13.6% and 14.4%, respectively.
But the returns won't stop there! Macquarie believes the ASX dividend stock has plenty of upside potential. It currently has an outperform rating and $2.64 price target on its shares, which suggests that they could rise a sizeable 50% from current levels.
In total, you are looking at a return of greater than 60% over the next 12 months if Macquarie is on the money with its recommendation.
Commenting on the fund manager, the broker said:
GQG portfolios remain defensively positioned, resulting in all strategies underperforming their respective benchmarks FY25YTD.
Valuation: Our TP is $2.64 (previously $2.90), with earnings changes reflecting lower flows expectations and updated FX. We lower our valuation to be the mid-point of P/E range of 10-11x (previously 10-12x) to reflect outflow risk. Outperform. GQG is trading at <8x NTM P/E with a 11-12% yield.
