There aren't too many ASX dividend stocks that offer dividend yields of more than 10%. It's rare to find a business with a sustainable payout when the dividends are that large. Shaver Shop Group Ltd (ASX: SSG) seems to be one of those rare finds.

Shaver Shop is a specialty retailer of male and female personal grooming products across 123 stores in Australia and New Zealand. The last few years have been rewarding for investors focused on achieving rewarding dividend levels.

When a company has a dividend yield as high as 10%, we shouldn't expect much dividend or capital growth. The high yield implies that the business is not holding onto much of its generated profit, resulting in a relatively low amount reinvested for more growth.

However, it doesn't need to be a fast grower to be a pleasing ASX dividend stock. There are a few reasons why I like the Shaver Shop business.

Dividend yield

Shaver Shop paid an annual dividend of 10.2 cents per share for the 2024 financial year, which was the same as its 2023 dividend payout.

At the current Shaver Shop share price, the business has a fully franked dividend yield of 7.8%.

That's a grossed-up dividend yield of 11.1% if we include the franking credits.

Dividend stability

One danger of investing in a business with a high dividend yield is that the large payout may only be fleeting.

Big dividends can be cut, which is what we often see with ASX mining shares because their profits are cyclical and volatile.

However, Shaver Shop has managed to display an impressive level of dividend stability over the last several years.

The ASX dividend stock grew its annual dividend per share every year between 2017 and 2023. It then maintained its dividend in FY24, providing ongoing stability for shareholders.

However, there's no guarantee there won't be a dividend cut in the future.

Earnings growth potential

With an ASX retail share, it would be unwise to assume that profit will grow every single year. Indeed, in FY24, the net profit after tax (NPAT) fell by 10.1%.

But over the longer term, I believe the business has the potential to grow earnings. It's looking to selectively open new stores, including increasing the number of New Zealand stores, relocating within shopping centres, refitting stores to the latest standards, driving category and range expansion with new brands, leveraging its exclusive distribution agreements and more.

Once economic conditions start improving, I think the retail environment will become more supportive of the ASX dividend stock's profit and be useful for the dividend payment.