Westpac Banking Corp (ASX: WBC) shares have a big dividend yield.
Indeed, while the bank's 8% share price fall in 2016 has dampened shareholders' spirits, it has boosted its dividend yield dramatically.
In fact, Westpac's dividend yield currently stands at 6.07% fully franked based on its last two dividend payments equivalent to $1.87 per share.
Is Westpac's dividend too good to ignore?
Although no one can predict short-term share price movements, Westpac's recent falls emphasise why it's important to focus on the underlying fundamentals of a business before buying in.
Only then, having done your due diligence/research, can an investor be resolute when share prices fall unexpectedly.
For example, slowing house prices, waning profit growth and the potential for a cyclical downturn in the broader banking sector, are expected to take their toll on Westpac in the medium term. Therefore, buying shares for their dividend yield now could be premature.
Foolish takeaway
Before focusing on Westpac's dividend yield, investors should consider the risks associated with an investment in its shares. So despite boasting a term-deposit-crushing dividend yield of 6.1% fully franked, personally, I'd like to see what happens to the banking sector over the coming six months before buying in.
