This is the ASX 300 share offering a 9% dividend yield!

There's a lot to like about this business for dividends and growth.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

There are not many S&P/ASX 300 Index (ASX: XKO) shares that could provide shareholders with a dividend yield of more than 9%. oOh!Media Ltd (ASX: OML) is one of those companies that may have a very promising future ahead for passive income investors.

I'd imagine there are very few of those high-yield ASX 300 shares that are expected to deliver earnings growth of more than 33% between FY26 and FY28, which is what analysts are predicting.

oOh!Media describes itself as a leading out-of-home media company that helps advertisers, landlords, leaseholders, community organisations, local councils, and governments reach large and diverse public audiences.

It has an extensive network of digital and static locations across Australia and New Zealand, including roadside locations, retail centres, airports, train stations, bus stops, office towers, and universities.

Person handing out $100 notes, symbolising ex-dividend date.

Image source: Getty Images

The ASX 300 share is projected to pay a large dividend yield

oOh!Media decided to deliver investors a large dividend per share of 6.25 cents in FY25. The final dividend of 4 cents per share represented a year-over-year increase of 14%.

The business said that its full-year dividend payout ratio was 53% of underlying adjusted net profit.

The forecast on CommSec suggests the business could deliver pleasing growth in FY26 (and beyond). In the 2026 financial year, it's projected to increase its payout to 6.3 cents. The annual payment could then rise to 7.4 cents per share in FY27 and 8.1 cents per share in FY28.

Following the 35% decline of the oOh!Media share price in the last six months, the potential FY26 payout now translates into a grossed-up dividend yield of 9.4%, including franking credits, at the time of writing.

That shows the business could provide significant passive income in the next year.

Positives to consider about oOh!Media

There may well be a bit more competition at the moment, but the ASX 300 share operates in a growing sector, which alone could help the business deliver rising profits in the coming years. Scale has its advantages in an industry like this, and oOh!Media is one of the biggest in the sector.

A few weeks ago, when the company gave its FY25 results during the reporting season, it revealed some positive commentary.

It said that it continued to see growth in the 2026 calendar year, with first-quarter media revenue "pacing up 7% in Australia".

oOh!Media expects that out-of-home will continue to take revenue market share from other media sectors.

The ASX 300 share also noted that 2026 capital expenditure will be between $55 million and $65 million, largely funding new advertising assets.

The forecast on CommSec suggests the business is trading at 8x FY26's estimated earnings. Earnings per share (EPS) are projected to rise 34% over two years to 15.5 cents by FY28, which would mean it's valued at just 6x FY28's estimated earnings.

In other words, it seems really cheap, and I think it just needs to deliver a bit of earnings growth to justify a significantly higher share price.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Dividend Investing

ETF written in white on a multi coloured background.
Dividend Investing

Why I'd buy these 2 ASX ETFs for $10,000 a year in passive income

These two ASX ETFs provide a diversified means to earning a $10,000 yearly passive income.

Read more »

Woman holding $50 and $20 notes.
Dividend Investing

8 ASX shares going ex-dividend next week

Commonwealth Bank, Resmed, and AMP are among the ASX shares with ex-dividend dates next week.

Read more »

Woman relaxing on her phone on her couch, symbolising passive income.
Dividend Investing

Why I'd buy Telstra and these ASX dividend shares for passive income

These shares offer the type of qualities I would want from passive income investments.

Read more »

Close-up of a business man's hand stacking gold coins into piles on a desktop.
Dividend Investing

2 ASX dividend shares I'd buy today for passive income

These ASX dividend shares can deliver a strong passive income investors.

Read more »

Australian notes and coins symbolising dividends.
Communication Shares

Everything you need to know about the Telstra dividend

Owners of Telstra shares can look forward to another good dividend.

Read more »

A bland looking man in a brown suit opens his jacket to reveal a red and gold superhero dollar symbol on his chest.
Bank Shares

Revealed: The ASX bank share with the highest dividend yield today

The highest-yielding bank right now might surprise you.

Read more »

An older gentleman leans over his partner's shoulder as she looks at a tablet device while seated at a table.
Dividend Investing

134,814 shares of this high-yield ASX dividend stock pays an income equal to the Age Pension

I’d say this ASX stock is more appealing than the Age Pension.

Read more »

A man in a sweatshirt holds two different phones to compare telco services.
Dividend Investing

How many Telstra shares do I need to buy to generate $10,000 in passive income?

Telstra pays two fully-franked dividends per year.

Read more »