The AMP Ltd (ASX: AMP) share price has been a very well known clanger for ASX investors over the past five years. Perhaps due to its former size and scale, both in terms of market capitalisation, and presence on the Australian psyche, AMP's fall from grace has been especially well documented.
As it stands today, AMP shares are trading at a price of $1.06. That's just a hair's breadth from the company's 52-week (and all-time) low of $1.05. That's also far cry from the $13-plus this company was trading at back in 1999.
This was just a few years after its demutualisation and ASX IPO. AMP is now down more than 92% from those highs, as well as down 81.72% from where it was just five years ago at $5.81 a share.
Losses like these are catastrophic for an investors' wealth – representing a loss of 80-90 cents for every $1 invested in AMP shares.
But just like most ASX financials shares, AMP, at least until recently, was also one known as an ASX dividend heavyweight. Could these past dividends make up for these significant capital losses that investors have experienced with 'the AMP'?
Well, let's get the nasty stuff out of the way first. If an investor purchased $10,000 worth of AMP shares exactly five years ago, they would have received approximately 1,721 shares. Those 1,721 shares would today have a value of $1,824.40. Ouch.
But what about AMP's dividends?
AMP's dividends
Here is a complete summary of all of the dividends AMP Ltd has paid out since July 2016:
- October 2016 – 14 cents per share
- March 2017 – 14 cents per share
- September 2017 – 14.5 cents per share
- March 2018 – 14.5 cents per share
- September 2018 – 10 cents per share
- March 2019 – 4 cents per share
- October 2020 – special dividend of 10 cents per share
And…. that's it.
First of all, it's worth noting that AMP's dividend peaked in 2008 when the company sent 24 cents per share out the door every 6 months. It's been more or less downhill ever since.
Secondly, it's also worth taking into account that these dividends all came with franking credits. These were franked to 90% (with the exception of the 2020 special dividend, which was fully franked).
So, as you can probably gather, these dividends do not make up for AMP's dismal share price performance over the past five years. But let's see how the shortfall looks.
The dividends listed above amount to a total of 81 cents per share. So with our 1,721 shares, we would have expected to receive approximately $1,394 in dividend payments. Adding that to our capital that we have left after the past five years, and we get to a figure of $3,218.40.
So even with AMP's dividends included, we have still lost around $6,780. Or close to 68% of our initial investment. The marginal benefits of AMP's partial franking would narrow this gap, but only slightly.
Long story short, AMP has been a dreadful investment over the past five years, even if you include the dividend payments investors would have received over this period.
No doubt investors today would be praying that the next five years look a lot better for the AMP share price.
