The ASX share market has plenty of opportunities for investors to consider for passive income. There are a few names that offer dividend yields of more than 8%, which is a huge yield considering that return is close to the overall average ASX share market return.
Businesses don't need to be growing earnings at a huge pace to deliver strong returns if they're priced cheaply with a generous dividend payout ratio.
Let's take a look at two businesses that have exceptionally high dividend yields that are too good to miss.
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Universal Store Holdings Ltd (ASX: UNI)
Universal Store says it owns a portfolio of premium youth fashion brands, selling through stores, online and wholesale. Its main two brands are Universal Store and Perfect Stranger. It has more than 121 physical stores across Australia, serving "fashion focused customers".
On the dividend side of things, the business has increased its annual dividend per share each year since it started paying in 2021. Considering that record stretches through the inflation period of 2022 and 2023, I think that's very impressive for a retailer.
Universal Store has a strong track record of sales growth, as well as steady expansion of its store network across the country, including the fast-growing Perfect Stranger brand. In FY26 to week 43, Universal Store brand sales rose 11.8% and Perfect Stranger sales grew 39.8%, with like for like (LFL) sales growth of 8.5% and 12.9%, respectively.
With the mid-point of its FY26 guidance, which it hasn't retracted, total sales are expected to grow 11.5% and operating profit (underlying EBITA) could grow 15.4%.
Using the forecast on Commsec, the business is projected to pay a grossed-up dividend yield of 8.2%, including franking credits, at the time of writing.
WAM Microcap Ltd (ASX: WMI)
The other ASX share I want to highlight with a high dividend yield is WAM Microcap, a listed investment company (LIC) that only targets the smallest businesses on the ASX.
I think small-caps are the most exciting businesses to look at because they are earlier on with their growth journeys and may be very mis-priced by the market for its growth prospects. But, small-caps can also be volatile year to year.
Despite small caps having a rough time in the last few years, the WAM Microcap portfolio has still managed to deliver an average return per year of 14.1% (before fees, expenses and taxes) since June 2017.
The net return has been strong enough for the business to deliver a very large dividend yield and still deliver slight growth in its dividend payments.
The ASX dividend share has increased its annual dividend per share every year since FY18 when it first started paying a dividend, aside from FY24 when it maintained its annual dividend.
It expects to pay an annual dividend per share of 10.7 cents per share in FY26 – this translates into a grossed-up dividend yield of 10.6%, including franking credits.
