I am sure you’d like to know which among the 30 blue-chip companies or index stocks in the Philippine Stock Exchange (Philippine Stock Market) is the most generous dividend-issuer. In this report, you’ll see the 5-year average dividend yield of the 30 blue-chip stocks from 2015 to 2019.
Before we proceed, please read my previous reports just in case you haven’t read them yet.
- FINANCIAL Sector: 5-Year Average Dividend Yield of Each Stock (2015-2019)
- HOLDINGS Sector: 5-Year Average Dividend Yield of Each Stock (2015-2019)
- INDUSTRIAL Sector: 5-Year Average Dividend Yield of Each Stock (2015-2019)
- MINING & OIL Sector: 5-Year Average Dividend Yield of Each Stock (2015-2019)
- PROPERTIES Sector: 5-Year Average Dividend Yield of Each Stock (2015-2019)
- SERVICES Sector: 5-Year Average Dividend Yield of Each Stock (2015-2019)
Dividend yield is one of the factors that some investors consider when deciding whether it’s good to invest in a stock or not.
However, let me remind you that a relatively high dividend yield does not automatically mean that it’s logical to buy shares of that company.
Go back to the formula of the dividend yield so you’ll understand why.
Dividend Yield’s Formula
Dividend Yield = Dividend Per Share / Price Per Share
If Stock A issues a total of P1.00 cash dividend per common share for the entire year and the stock has a closing price of P100.00 per share for that year, the dividend yield of Stock A will be 1 percent.
High Dividend Yield Doesn’t Always Mean Good
Let’s use the formula.
Dividend Yield of Stock A = P1.00 / P100.00 = 0.01 or 1%
This means that if the price per share of the stock is in a continuous decline (bearish), the dividend yield becomes bigger.
I’ll create a scenario for you if in case you still didn’t get it.
Let’s say Stock A ended November and December this year at P100.00 and P90.00 per share, respectively. The stock issued a total of P1.00 cash dividend.
We’d like to get the year-end dividend yield. Therefore, we’re going to use the year-end closing price, which is P90.00 per share.
Dividend Yield of Stock A = P1.00 / P90.00 = 0.011 or 1.11%
Did you get what I’m trying to point out?
Look at the Capital Appreciation or Depreciation Also
Don’t immediately jump into conclusion that you should buy shares of a company just because it has the biggest dividend yield in its sector or industry within a specific period.
Check the capital appreciation or depreciation of the stock first.
What good will the 1% or 1.11% average dividend yield do to you if the stock has been declining by more than its dividend yield every year?
Don’t put too much weight on the dividend yield of the stock. Check its historical price action also.
Check if there is a confirmed buy signal before you buy shares. For our clients at Equilyst Analytics, we have an investment guide for long-term investors. We monitor the 30 blue-chip stocks everyday and inform our clients whenever there’s a confirmed buy signal already. We also tell them the dominant range where it is most logical to buy. Plus, we teach them the rationale behind all our bases on how we arrived to such interpretation (online stock market course).
It’s easy to compute for the dividend yield of a stock. The data for each variable in the equation is available online. Focus on enhancing your ability to create an investment plan that is solely based on your financial goals, investment horizon, and risk tolerance. Learn how to invest independently and trade tactically.
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Rank | Stock | 5YA (%) |
---|---|---|
30 | GTCAP | 0.378 |
29 | JGS | 0.412 |
28 | BLOOM | 0.698 |
27 | AC | 0.812 |
26 | RRHI | 0.838 |
25 | SMPH | 0.856 |
24 | JFC | 0.934 |
23 | PGOLD | 1.008 |
22 | AGI | 1.04 |
21 | BDO | 1.124 |
20 | SM | 1.2 |
19 | ALI | 1.228 |
18 | MEG | 1.362 |
17 | LTG | 1.372 |
16 | SMC | 1.41 |
15 | SECB | 1.426 |
14 | MBT | 1.436 |
13 | RLC | 1.626 |
12 | FGEN | 1.664 |
11 | MPI | 1.938 |
10 | AEV | 2.022 |
9 | URC | 2.056 |
8 | BPI | 2.226 |
7 | ICT | 2.254 |
6 | AP | 3.898 |
5 | GLO | 4.878 |
4 | DMC | 5.04 |
3 | MER | 5.674 |
2 | TEL | 6.654 |
1 | SCC | 13.328 |
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