The stock market ‘hack’ on Friday raises Telefónica’s dividend to 3.8%

Last Wednesday, Telefónica confirmed the calendar of its next dividend, which will be in scrip (payment in shares), a formula that the teleco began to resort to in June 2020, in the midst of a pandemic, “for reasons of financial prudence,” as indicated at the time by the company itself. Check here the calendar of the next dividends.

On December 17, it will pay 0.15 euros to those shareholders who choose to collect it in cash. With the latest stock market falls -Telefónica dropped 2.9% this Friday on the market-, the profitability of this delivery has risen to 3.84%. To be able to pocket it, of course, it is necessary to have the securities in the portfolio by November 30 at the latest, and to have requested the remuneration in cash (the deadline to do so ends on December 9).

For their part, shareholders who prefer to receive the dividend in shares do not have to do anything, just wait to receive the titles that correspond to them based on those they already have. In this case, the ratio is 26 shares to receive one new share.

The other side of the ‘scrip dividend’

The scrip dividend It has the pernicious effect that, given that the shares used to reward are the result of an increase (newly issued shares), so that the capital pie is divided into more pieces; and, therefore, whoever chooses cash sees the portion of the cake he owns reduced. This effect is only partially offset by Telefónica repurchasing and redeeming its own securities. On November 3, the company chaired by José María Álvarez-Pallete announced the amortization of its entire treasury stock, which represented 1,654% of the company’s capital. It is more than double what the group announced in the first half results.

Those 0.15 euros that the teleco will distribute within a couple of weeks will be complemented with a second payment, of the same amount, already foreseeably in June 2022 (the firm usually pays twice a year). Those 0.30 euros that will be paid out of 2021 worsen by 25% the 0.40 euros that the group had been distributing in recent years. This reduction, as the scrip, was adopted by the group due to the impact of the Covid.

Atresmedia already offers 5.1%

Telefónica is currently one of the five members of the EcoDividendo -the strategy of the Economist which collects the most attractive upcoming payments on the Spanish stock market-, and also one of the closest dividends within the portfolio. Just one day before her, on December 16, Atresmedia, another member of the strategy, will pay its shareholders. The media group yielded 4.3% this Friday, with which the 0.18 euros that it will deliver already offers 5.1%.

The profitability that has also risen strikingly due to the recent falls in the stock market is that of the Mapfre payment: the insurer will deliver 0.06 euros next Tuesday, which rents 3.3%. Of course, it is too late to enter the value.