The ASX-listed Shaver Shop Group Ltd (ASX: SSG) is poised to offer a significant dividend yield of 10% next year, continuing its streak as a compelling option for investors seeking passive income. This announcement comes as the company solidifies its position as a leader in the personal grooming retail market across Australia and New Zealand.
With a strong focus on becoming the market leader in hair removal products, Shaver Shop offers a wide range of items, including electric shavers, clippers, trimmers, and wet shave products. The company currently operates 124 stores and maintains a robust online presence through platforms such as eBay, Amazon, and TradeMe.
Consistent Dividend Growth
Shaver Shop has consistently increased its annual dividend per share since 2017, with the exception of 2024. In FY25, the company raised its dividend by 0.1 cents per share to 10.3 cents, translating to a grossed-up dividend yield of 10.3% when franking credits are included. This yield is particularly attractive when compared to the returns of the S&P/ASX 200 Index (ASX: XJO).
The company’s earnings per share (EPS) in FY25 stood at 11.5 cents, with cash EPS at 12.1 cents, suggesting ample room for further dividend increases. Analysts believe that Shaver Shop could potentially raise its annual payout per share to at least 10.4 cents in FY26, driven by its robust financial performance.
Strong Financial Performance
In the initial seven weeks of FY26, Shaver Shop reported a total sales growth of 2.7%, with like-for-like sales growth at 1.5%. This sales momentum is crucial for driving net profit, which in turn supports dividend payouts. The company also noted an improvement in its gross profit margin, partly attributed to the success of its private brand, Transform-U.
“Our strategic focus on expanding our private brand and optimizing our store network is yielding positive results,” said the CEO of Shaver Shop.
Expansion and Market Strategy
Shaver Shop’s growth strategy includes opening new stores and enhancing existing ones. The company plans to launch two new stores in the first half of FY26, with additional openings slated for the second half. Moreover, store refits and relocations are expected to enhance customer experience and operational efficiency.
This expansion is anticipated to increase the company’s market share and scale, further strengthening its competitive position. The ability to negotiate exclusive products with suppliers allows Shaver Shop to offer a diverse range of quality brands at competitive prices, a key driver of its market success.
Expert Opinions and Market Outlook
Market analysts are optimistic about Shaver Shop’s future, citing its strategic initiatives and financial health as indicators of continued growth. The company’s focus on expanding its product categories, including oral care, hair care, and beauty products, is expected to drive further revenue.
“Shaver Shop’s commitment to innovation and customer satisfaction positions it well for sustained growth in the competitive retail landscape,” noted a market analyst.
Looking Ahead
As Shaver Shop continues to execute its strategic plans, investors remain optimistic about its potential to deliver strong returns. The company’s focus on expanding its retail footprint and enhancing its product offerings is expected to support both profit and dividend growth in the coming years.
With a solid foundation and a clear vision for the future, Shaver Shop Group Ltd is well-positioned to maintain its status as a top choice for dividend-seeking investors in the ASX market.
