When it comes to investing for passive income, patience is everything. The best returns often come not from chasing the highest yield today, but from owning businesses that grow their dividends steadily year after year.
One ASX share that looks well positioned to do just that is Accent Group Ltd (ASX: AX1). It is the footwear and apparel retailer behind brands like Platypus, Hype DC, and The Athlete's Foot.
Its shares are currently changing hands for around $1.20, and if Bell Potter's forecasts prove accurate, the company could become a genuine passive income star for patient investors.
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The path to rising income
Bell Potter expects Accent Group to pay fully franked dividends of 7.8 cents per share in FY 2026, 9.2 cents in FY 2027, and 10.5 cents in FY 2028.
That means an investor putting $20,000 into Accent Group shares today could buy roughly 16,666 shares. If the broker's forecasts prove accurate, those shares would generate $1,750 in annual dividend income by FY 2028. And that's before including the benefit of franking credits.
This is a reminder of how powerful patient, income-focused investing can be. You don't need to find a company paying 10% today, you need one that's growing steadily toward it.
Is it a good option?
While the last 12 months have been difficult, Accent Group's management has a strong track record of shareholder returns, and the business is now well positioned to benefit from both a retail recovery and its ongoing expansion across sports and lifestyle categories.
Bell Potter is bullish on the company's growth prospects. It has a buy rating and $1.80 price target on its shares. That represents potential upside of 50% from current levels, on top of the growing stream of dividends.
Commenting on the ASX stock, the broker said:
In the near term, we expect monetary policy catalysts to drive recovery in the lifestyle segment from 2Q26e, while in the medium-long term, we see a higher growth focus for AX1 leveraging the outperforming sports segment via dominant global partner and key shareholder, FRAS. With the first Sports Direct store opening in mid-November, we anticipate the unlocking of the sizable store roll-out opportunity for the banner in Australia (50-store target over 6 years), while benefiting from a higher relevance to leading brand partners such as Nike backed by FRAS.
This highlights how Accent Group's future is about scaling. The upcoming rollout of the Sports Direct brand in Australia could open up a powerful new revenue channel, especially with backing from global sports giant Frasers Group (FRAS).
In light of this, this ASX stock could be one to buy and hold onto for the long term. Because if Bell Potter's forecasts are right, investors who buy today and hold through the next few years could enjoy not just an expanding income stream, but also healthy capital appreciation as the company executes its growth strategy.
