US folks seem to find it challenging to calculate international ADR’s dividend. The primary problem is that international stocks do not have uniformed dividends.
Here I will show you how you can get the figures fast and accurate at 2 sites and also talk about the dividend sustainability of Vodafone.
For international stocks they are usually made up of
- Interim dividend – smaller
- Final dividend – larger
- Special dividend – comes with the Final dividend if it’s a bountiful year
For those who wants to review a stock’s dividend history, one useful site to get very accurate distribution information is NASDAQ’s website
See how well the information is structured. Wish SGX looks this easy.
If you add up 2012’s dividends, they come up to USD $1.53
Another place where you can gain information of the distribution is Vodafone’s ADR site
Why is it important to check the official site is because some companies charges for handling of ADR dividends.
In the case of vodafone there is a total of USD 3 cents charge per share dividend. This provides somewhat of a rough 2% drag to your dividend.
Its funny that how come the latest distribution reflected in NASDAQ was not reflected on Vodafone’s site.
So if you deduct the 3 cents from the USD $1.53 dividend you will get $1.50
Financial Times is a favorite site of mine because you can quickly search for not just US stocks but also international listed stocks.
If you don’t believe me, search up obscure stocks like Nam Lee in Singapore, Zhejiang Expressway in Hong Kong. You will be able to find them.
Interestingly you can find 5 years worth of balance sheet, income statement and cash flow statement and price changes here.
To top it off the dividend per share is rather accurate for most I see.
Here you will see it correspond to NASDAQ.com’s figures.
You can also do a quick reference of the number of shares outstanding.
The Dividend Yield currently is thus 1.50/25.58, which works out to be 5.86%. That’s a rather good yield.
Is dividend sustainable
How much cash flow is required to pay for a USD $1.53 dividend?
You can see the shares outstanding there at FT.com. This will work out to a dividend payment of 1.53 x 4900 = USD $7497 mil
Convert that to GBP at 1.599 times, we get 7497/1.599 = GBP $4699 mil
In the last conference call, the management is still projected a full year free cash flow of GBP $5300 mil.
So essentially current dividend is 88% of free cash flow.
This does not include the cash flow distribution from 45% owned Verizon Wireless whose distribution are rather uncertained.
End state, the cash flow sans Verizon Wireless could sustain the current 5.86% yield. And the Verizon distribution can be used for additional capex or buy back shares to boost future dividends.
Still caveat is Europe may have room to weaken in terms of plan downgrades. I don’t expect the next 3 years dividend to be raised 7% per year again.
I run a free Singapore Dividend Stock Tracker available for everyone’s perusal. Do follow my Dividend Stock Tracker which is updated nightly here.