The Wesfarmers (ASX:WES) share price is trading on a forecast 2.78% fully franked dividend yield

How does the retail conglomerate stack up for its dividends?

| More on:
An older woman high fives an older man with big smiles after seeing good news on their laptop regarding their ASX tech shares

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Wesfarmers Ltd (ASX: WES) share price has gained 35% since this time last year. This comes as the retail conglomerate enjoys improved trading conditions despite COVID-19 affecting Australia's wider economy.

During Thursday's trading session, Wesfarmers shares touched a new all-time high of $66.16. At market close, its shares finished the day up 1.73%, trading at $65.99.

Why is the Wesfarmers share price pushing higher?

Investors are pushing up the Wesfarmers share price despite no market-sensitive news coming from the company since July.

According to its last update, Wesfarmers proposed a takeover to acquire 100% of Australian Pharmaceutical Industries Ltd (ASX: API). The $687 million offer came as the retail conglomerate seeks to further diversify its growing portfolio with entry into the pharmaceutical market.

The news sent Wesfarmers shares flying from the time of the release and in the following weeks.

However, the API board recently rejected the offer, indicating that the proposal undervalued the business.

At this stage, Wesfarmers has not increased its bid to API shareholders.

How much is Wesfarmers forecasted to pay in dividends?

With the company scheduled to report its full-year results on 27 August, investors may be wondering about the dividend payments.

Wesfarmers paid a fully franked dividend of 88 cents per share in March for the first half of FY21, slightly below the 95 cents in the prior period (FY20). That dividend payment comprised 77 cents along with a special dividend of 18 cents per share.

Goldman Sachs is forecasting a total FY21 dividend payment of $1.84 cents, implying a 96 cents per share final dividend payment. This would give Wesfarmers a fully-franked current dividend yield of 2.78%. Not a bad return when including the strong Wesfarmers share price rise.

The company has a price-to-earnings (P/E) ratio of 39.37 and commands a market capitalisation of roughly $74.8 billion.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ⏸️ Dividend Yields

Older woman looks concerned as she counts cash notes
⏸️ Dividend Yields

The Santos (ASX:STO) share price is now trading on a trailing 2.35% fully-franked dividend yield

The company's falling share price has boosted its dividend yield.

Read more »

A happy doctor in a white coat dancing due to his excitement over the EBOS acquisition
⏸️ Dividend Yields

The Medibank (ASX:MPL) share price is now trading on a forecast 3.76% fully franked dividend yield

Is it worth buying the health insurance company's shares for its dividend?

Read more »

man with his hand on his chin wondering about the AIM share price
⏸️ Dividend Yields

The AMP (ASX:AMP) share price is trading on a forecast 9.4% dividend yield

With a strong dividend yield, does this mean shareholders should invest in the company?

Read more »

man thinking about whether to invest in bitcoin
⏸️ Dividend Yields

Should you buy CBA (ASX:CBA) shares in July 2021 for the dividend yield?

Australia's largest bank is set to report its dividend next month.

Read more »

happy woman looking at her laptop with notes of money coming out representing financial success and a rising share price and dividend yield
Share Market News

Should you buy Mineral Resources (ASX:MIN) shares in July for the dividend yield?

We take an in-depth look at the Mineral Resources dividend and one broker's forecast for FY21 and FY22.

Read more »

man handing over wad of cash representing ASX retail capital return
⏸️ Dividend Yields

3 little-known ASX dividend shares offering big income

The 3 little-known ASX dividend shares in this article offer investors a high yields. One of those ideas is Pacific…

Read more »

large block letters depicting four percent representing high yield asx dividend shares
⏸️ Dividend Yields

3 ASX dividend shares with yields above 4%

There are some ASX dividend shares with yields of more than 4%. One of those ideas is farmland REIT Rural…

Read more »

fingers walking up piles of coins towards bag of cash signifying asx dividend shares
⏸️ Dividend Yields

3 ASX dividend shares with large yields and consistent payouts

In this article are 3 ASX dividend shares that have large yields and consistent payouts, including JB Hi-Fi Limited (ASX:JBH).

Read more »