2 cheap, dividend-paying AIM shares I’d buy to hold for 10 years!

London’s Alternative Investment Market (AIM) can be a great place to find great growth stocks. It can also be a fun hunting ground for investors looking for the highest dividend stocks.

Here are two income producing AIM stocks that caught my eye. I will be looking to add to my own investment portfolio if I have money to invest.

Accrol Group Holdings

Tissue manufacturers Accrol Group Holdings (LSE:ACRL) pays a 1.2% dividend for the year. But City analysts expect shareholder payouts to grow rapidly over the medium term as earnings recover.

Supply chain issues and higher costs have taken a toll on profits in recent times. And that could be a problem for businesses going forward.

But I believe that sales of own-label products are increasing still as a top buy. It declares “substantial growth in volume, revenue, and profit” between May and October as the cost-of-living crisis draws shoppers away from more expensive toilet paper brands.

Accrol’s market share increased by two percentage points annually, to 21.5%. And I don’t believe business is a flash in the pan. I think profits here can continue to grow as the retail market picks up.

Analysts at IGD expect discount retailing in the UK to grow by 23.9% between 2022 and 2027. The continued expansion of discount chains like Aldi and Lidl – allies with increasingly cash-strapped shoppers – provides Accrol with good profit opportunities.

One last thing. At current prices, the company is trading at a price-to-earnings growth (PEG) ratio below 1 for each of the next three fiscal years. The reading indicates an undervalued stock.

Vertu Motors Kab

Buying retail stocks could be dangerous for investors as the UK economy struggles. The outlook is dire for sellers of big-ticket items like cars.

Still, it’s a difficult opinion to bake into Vertu Motors Kab‘ (LSE:VTU) rock-bottom valuation. Today, the business trades at a forward price-to-earnings (P/E) ratio of 7.4 times.

It’s also true that the company’s extensive network of used cars can help protect against more pressure on consumers’ wallets. Sales of pre-owned vehicles are likely to increase as people switch from newer, more expensive models.

As a long-term investor, I believe that buying Vertu might be a good way to capitalize on the electric vehicle (EV) boom. This is because modern car buyers prefer to visit showrooms for advice before buying. Vertu has 188 franchise stores on its books following the acquisition of Helston Motors in December.

Like Accrol, Vertu will also grow its dividend over the next few years. This pushed the yield a healthy 3% for the current 12-month period higher.