Dividend season is a great time of year. I always think it is Christmas for adults.
Today BHP pays its dividend which at today’s share price is yielding a huge 7.28% and according to the BHP website they still plan to maintenance or increase their dividend.
“BHP Billiton has a progressive dividend policy. The aim of the policy is to steadily increase or at least maintain the dividend per share in US dollar terms at each financial half year.”
I personally have my doubts due to the ongoing commodity price slide that is going on in Australia and throughout the world. The only saviour may be the failing Australian dollar which might help maintenance the dividend pay out amount due to BHP paying in US dollars. So as the Australian dollar falls against the US dollar the dividend will appear larger when it is converted.
So today BHP will pay 62c USD a share franked at 30%. In Australian dollar this is 87.781c a share.
I personally expect to receive a payment of $85.70 today which isn’t bad considering I only own a small number of BHP shares (100).
As BHP doesn’t provide a dividend reinvestment plan I will be using the payment to help reduce my margin lending account balance.
Time will tell if BHP can maintenance its progressive dividend policy but I would personally not be buying more BHP shares for the dividend yield alone.
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