It is not the only big dividend on the horizon, but it is one of the most anticipated for the Spanish stock market because of how many shareholders will benefit. Telefónica will distribute 1.82 billion euros to around 1.5 million shareholders for a price per share of 0.40 euros.
To better understand the numbers, here is an example. An investor who buys 3,000 euros of Telefónica stock at the current market value of 12.20 euros per share would receive a little less than 100 euros in dividends, the last payout that corresponds to the telecom's 2013 earnings. It paid 0.35 euros per share last November. All in all, it will allocate 3.4 billion euros to dividends for the year, which is 74% of last year's net profits. This amount is in line with pay outs (the percentage of earnings that companies allocate to their shareholder dividend) offered by other European telecoms.
As for BBVA and La Caixa, who are the benchmark stocks for tracking dividends on the Ibex, they are under a tighter squeeze. Francisco González's company will get 126.7 billion euros in cash thanks to owning 6.96% of La Caixa. Telefónica's CEO, César Alierta, will rake in 1.76 billion euros.
The next payout will bring some changes, because the company will start to employ a scrip dividend policy where shareholders have an option to receive their dividend in cash or more shares. In the last and only time that this kind of dividend was offered before, Alierta chose to take more stock shares and not the cash. Now Telefónica will use this strategy for its first 2014 dividend, which will be paid out in November, although the second quarter dividend that will be paid out in May 2015 will be cash. The total amount should be 0.75 euros per share.
BME pay out on Friday
Also this week, BME will offer one of the most attractive dividends on the Spanish stock market. The company will pay out 0.65 euros per share on Friday for earnings it made in 2013. This amount is slightly higher than the 0.6 euros per share that it paid last year. But, BME plans to withhold an extra dividend that it usually pays, choosing a prudent path while waiting to see what new regulations the EU comes up with.
Just days before the payout and following its Q1 earnings report, BME shares moved 9.7% last week. It was its best quarter since 2010 and the beginning of a year that should pan out well. The company was one of the best trending stocks on the Ibex last year as it regained its IPO value of 31 euros per share for the first time in six years, finishing the week at 32.72 euros per share.
