JB Hi-Fi Ltd (ASX: JBH) shares may be a very underrated pick at this time for retirees.
An ASX retail share may not seem like the most compelling business for dividend income or long-term returns.
But, the owner of JB Hi-Fi Australia, JB Hi-Fi New Zealand, The Good Guys and E&S actually has a number of positives, including an incredible dividend record.
Let's take a look at what makes it so appealing.
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Excellent dividend record for retirees
JB Hi-Fi has an excellent dividend record for an ASX retail share. Looking back, it has increased its dividend almost every year since 2013, aside from a slight reduction in FY23, which is understandable considering the headwind of high inflation and rising interest rates.
In the recent FY26 half-year result, the business increased its interim dividend per share by 23.5% to $2.10 per share. HY26's growth was partly because of earnings growth and partly due to an increase in the dividend payout ratio, going from 65% of net profit to 75% (thanks to its increased dividend payout guidance range of between 70% to 80%).
JB Hi-Fi said that it continues to maintain a strong balance sheet and will continue to regularly review its capital structure with a focus on "maximising returns to shareholders and maintaining balance sheet strength and flexibility".
The current forecast on Commsec suggests the business could pay an annual dividend per share of $3.42 in FY26. That translates into a grossed-up dividend yield of 6.8% (including franking credits) at the time of writing, which I think would be a great starting yield for retirees.
Good growth potential
I'd describe JB Hi-Fi as the best electronics retailer in Australia. It has a number of competitive advantages including its scale, multiple brands, low cost operating model, multichannel approach and its people.
I think it's those factors that help the business stay ahead of others, deliver solid margins and grow its market share.
The business continues to grow its sales, with solid progress in January 2026. JB Hi-Fi Australia sales increased 4% and The Good Guys sales grew 2.7% year over year.
I also think JB Hi-Fi has more defensive earnings than some investors may give it credit for, with demand for smartphones, laptops and appliances being somewhat consistent.
This could be a good time to invest for retirees because the JB Hi-Fi share price has declined by around 40% over the past six months and more than 25% in the year to date (at the time of writing).
It's now trading at under 16x FY26's estimated earnings, which seems good value to me.
