The ASX dividend stock Universe Store Holdings Ltd (ASX: UNI) has fallen 19% from its 2026 high in February 2026, as the chart below shows. I think it's a great time to invest in the ASX retail share.
Universal Store says it owns a portfolio of premium youth fashion brands. Its principal businesses are Universal Store (trading as Universal Store and Perfect Stranger) and CTC (trading as the THRILLS and Worship brands),
At the last count, it had 123 physical stores across Australia. Its strategy is to grow and develop its premium fashion apparel brands and retail formats, targeting fashion-focused customers.
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Higher dividend yield
When a share price changes, it means investors can get a higher dividend yield.
For example, if a business has a dividend yield of 6% and then the share price drops 10%, then the dividend yield becomes 6.6%, which is a big difference for investors wanting dividend income.
As I've mentioned, Universal Store's share price has fallen 19%, significantly boosting the dividend yield.
In FY26, the ASX dividend stock hiked its annual dividend per share by 11.7% to 43 cents per share. That's currently a grossed-up dividend yield of 8.1%, including franking credits, at the time of writing.
The projection on Commsec suggests the business could hike its annual dividend per share by 4.7% to 45 cents per share. That implies a forward grossed-up dividend yield of 8.4%, including franking credits, at the time of writing.
In terms of passive income, the company is clearly expected to deliver huge payouts.
Ongoing growth
The ASX dividend stock is showing it can deliver growth, even in weak economic conditions. Not many ASX retailers can say that right now.
In FY26, the company generated group sales growth of 12.9% to $376.1 million, with particularly impressive performance by Perfect Stranger which grew sales by 40.8% to $35.9 million.
It also reported that the gross profit margin improved by 140 basis points to 62.5%, and underlying net profit after tax (NPAT) rose by 16.3% to $40.5 million. As you can see, its profit margins rose despite inflation in costs.
FY27 has started strongly and I think this bodes very well for future growth.
In the first seven weeks of FY27, group direct-to-customer sales were up 9.1%, including Perfect Stranger sales growth of 45.8% (partly powered by like-for-like sales growth of 17.6%). Universal Store sales growth was 5.5%, with LFL sales growth of 2.9%.
Management intends to open between 16 and 20 stores in FY27, including nine to ten new Universal Store locations, six to eight new Perfect Stranger stores and one or two new THRILLS stores.
According to the projection on Commsec, the Universal Store share price is valued at 13x FY27's estimated earnings. I think this is a great time to invest in the ASX dividend stock, though it's not the only opportunity out there right now.
