Ex-dividend date is an important one if you want to be eligible for a dividend payment — as long as you hold the shares up to and including that day, you’ll get your money. Alternatively, sometimes share prices fall further than expected when the day comes around, and if you’re careful you can perhaps pick up a bargain.
Here are three FTSE companies reaching the critical date next Wednesday, 28 August:
Legal & General Group
We’ll have an interim dividend of 2.4p per share from Legal & General Group (LSE: LGEN), and it comes after a pleasing set of first-half figures released on 6 August. The firm enjoyed a 14% rise in operational cash generation, with pre-tax profit up 13% to £529m and earnings per share (EPS) up 13% to 7.82p.
The interim dividend of 2.4p represents a rise of 22% over the corresponding period a year previously. If we see a similar rise in the final payment we’ll be looking at a full-year 9.3p, providing a 4.7% yield on the current share price of 197p. And that price, incidentally, is up around 50% over the past 12 months. Growth or income? Have both!
Tullow Oil (LSE: TLW) has not rewarded its shareholders with a price rise this year — in fact, it’s down 25% to 1,034p over the past 12 months. But there is at least a 4p-per-share interim dividend to come, which was held flat for the six-month period to 30 June despite pre-tax profit dropping 41% and EPS falling 47% to 32.2 cents.
The profit situation was actually better than it looked, mind, as the first half of 2012 had been buoyed by $702m in profit from disposals — gross profit this year was actually up 13% to $764m after revenues grew 15%.
Our final ex-dividend event next week is from Stagecoach (LSE: SGC), and this time it’s a final payment of 6p per share after the transport operator brought home a forecast-busting 18.9% rise in EPS to 30.2p. The final 6p takes the firm’s full-year total to 8.3p per share, up 10.3% on the previous year.
The Stagecoach share price has slipped back a bit over the past month, but at 315p it’s up around 6% over the past year. At the current price, that 8.3p dividend represents a 2.6% yield — that’s not massive, but it’s growing and there’s a further 8% rise forecast for 2014.
Finally, do you like having your investment returns boosted by dividends like these? Dividends can be spent or reinvested according to your needs — whether you’re investing for income or growth, good old cash is always welcome.
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> Alan does not own any shares mentioned in this article.
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