I think ASX growth shares that are delivering rising earnings and increasing payouts can be very attractive investments.
It's wonderful to own businesses where the share price rises, but if the company doesn't pay dividends, then our bank account doesn't benefit until we sell.
I like that we can own growing companies that send some of their profits to shareholders each year in the form of dividends. In five years, the dividend payouts from these businesses could have grown dramatically, combined with potentially exciting capital growth.
Let's dive in.
Lovisa Holdings Ltd (ASX: LOV)
Lovisa describes itself as a fashion-forward jewellery brand that caters to everyone.
It has at least 10 stores in numerous countries including Australia, the USA, Canada, the UK, France, Germany, Belgium, the Netherlands, Poland, Italy, Ireland, Singapore, Malaysia and South Africa.
The company's addressable market is huge. It has close to 1,100 stores in total, but Australia (over 180 stores) and the USA (around 230 stores) are the only two locations that have more than 100. It can expand for many years in existing countries (such as Canada, the UK, China and Germany) as well as entering new markets.
While the growth rate in total sales won't directly match net profit growth or dividend growth, I think the outlook for all financial metrics is very promising.
The projections on Commsec suggest the business could decide on a dividend payout ratio that's close to 100%, as it has done in the last few years, unlocking a powerful dividend yield for investors.
The FY26 projection on Commsec suggests the ASX growth share is trading (at the time of writing) at 29x FY26's estimated earnings with a possible dividend yield of 3.1%, excluding any franking credits benefits. The FY28 forecasts suggest the business is trading at under 23x FY28's estimated earnings, with a possible dividend yield of 3.7%, excluding franking credits.
Pinnacle Investment Management Group Ltd (ASX: PNI)
I think Pinnacle is one of the most underrated businesses on the ASX in terms of its dividend potential.
When it comes to dividend potential, I think investors should evaluate both the current yield and the potential for regular dividend growth.
Before we get to the possible dividends, I'll mention what it does. It invests in promising funds management businesses, taking a minority stake and helping them grow. There are numerous services it can provide to help the fund manager focus on investing, which includes compliance, legal, client distribution, seed funds under management (FUM), working capital and more.
You may recognise some of the fund managers in the ASX growth share's portfolio, such as Spheria, Solaris, Resolution Capital, Plato, Palisade, Pacific Asset Management, Metrics, Firetrail, Five V, Coolabah Capital, Antipodes and Aikya.
According to the forecast on Commsec, it's expected to deliver a grossed-up dividend yield of around 5.75%, including franking credits. By FY28, the grossed-up dividend yield could be 8.4%, including franking credits.
One of the key reasons the business has strong growth potential is because of the ongoing FUM growth of the fund managers.
In the three months to 30 September 2025, its FUM grew to $197.4 billion, an increase of $18 billion (or 10%) from $179.4 billion at 30 June 2025.
Of that increase over the three months, $13.3 billion of the rise related to net inflows over the period. Within that total, $4 billion were Australian retail net inflows, $2.9 billion was international net inflows and $6.4 billion was Australian institutional net inflows. This shows broad success for the company.
If Pinnacle's total FUM continues rising in the double-digits in percentage terms, then the ASX growth share has a very promising future for dividends and profit growth.
