I believe one of the most important factors when investing in ASX dividend shares is picking stocks that are growing their passive income payments to shareholders.
As we've seen in the last few years, it's useful to have income growth to offset inflation of expenses.
Dividend growth suggests the underlying performance of the business is going well and the leadership have a desire to reward shareholders.
I'm going to highlight two ASX dividend shares with a compelling dividend streak.
Brickworks has been one of Australia's biggest brickmakers for decades. It's also involved in pavers, roofing, stone and masonry, cement, timber battens, and more.
However, it's the company's other assets that are generally helping pay for the company's dividend.
The ASX dividend share owns half of an industrial property trust which owns large warehouses (with more being built). Those project completions are helping grow the underlying value of the land and unlocking rental profits to help fund larger dividends.
Brickworks is approximately a quarter of the diversified investment conglomerate Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). Soul Patts has grown its annual ordinary dividend every year since 2000, which has helped Brickworks grow its own dividend.
The business has grown its annual dividend per share each year since 2014 and hasn't reduced its dividend for close to 50 years. It grew its FY25 half-year dividend by 4.2% to 25 cents per share and currently has a grossed-up dividend yield of 3.9%, including franking credits.
This company says it's Australia's premier owner and operator of youth and young adult fashion retail brands. Its businesses include Universal Store, Perfect Stranger, Worship, and THRILLS.
The business is seeing rapid growth in both its same-store sales and new store openings. It's expecting to open at least 12 new stores in FY25.
The ASX dividend share's trading update for the first seven weeks of the second half of FY25 was very promising, with total sales growth of 90.1% for Perfect Stranger and 27.6% for Universal Store.
The FY25 half-year result saw the business grow its underlying earnings per share (EPS) by 15.2% to 30.3 cents, and the interim dividend was hiked by 33% to 22 cents per share.
Universal Store has grown its dividend each year since it first started paying one in 2021, which is impressive for a retailer that experienced the inflationary periods of 2022 and 2023. It currently offers a grossed-up dividend yield of approximately 7.5%, including franking credits.
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