What is the NAB (ASX:NAB) fully franked dividend worth in November?

We take a look at what investors can expect to receive from the banking giant

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When it comes to ASX banking shares, most investors come for the dividend and stay for the dividend (and maybe the franking credits). It’s arguably no different for National Australia Bank Ltd (ASX: NAB) shares.

Like the other major ASX banks, NAB hasn’t exactly reclaimed its former glory in the dividend space. Sure, it seems to be well on the road to recovery after the devastation of last year’s COVID crash (and dividend wipeout). But this was a bank that, only a few years ago, was paying out $1.98 in fully franked dividends per share every year. Contrast that figure with the grand total of 60 cents per share that investors received last year and you get the picture.

But NAB has recently released its full-year results for FY2021, which of course included information on its upcoming final dividend. So has the game changed for shareholders?

Well, it was arguably good news. Yes, NAB reported a 76.8% rise in cash earnings to $6.56 billion, as well as a return on equity metric of 10.7%. That was despite revenues falling 2.4% to $16.73 billion.

What are NAB’s dividends in 2021 looking like?

But the real news for income-focused investors was the announcement of a final and fully franked dividend of 67 cents per share (in itself more than NAB’s entire 2020 payouts). This 67 cents per share dividend comes after NAB’s July interim payment of 60 cents per share (also fully franked) and will hit investors’ bank accounts on 15 December.

The 67 cents per share dividend is a 123% increase from last year’s final dividend of 30 cents per share. The total of $1.27 per share in dividends that investors will receive from NAB in 2021 is likewise a 112% rise on 2020’s 60 cents per share in total dividend payments.

It also gives NAB shares a dividend yield of 4.51% (or 6.44% grossed-up with full franking) at the current share price (at the time of writing) of $28.11.

By comparison, Commonwealth Bank of Australia (ASX: CBA) shares are currently offering a dividend yield of 3.65%. Westpac Banking Corp (ASX: WBC) has 5.51% on the table. And Australia and New Zealand Banking Group Ltd (ASX: ANZ) is putting up 5.2%.

At the current NAB share price, this ASX bank has a market capitalisation of $92.07 billion, with a price-to-earnings (P/E) ratio of 14.95.

Should you invest $1,000 in NAB right now?

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Motley Fool contributor Sebastian Bowen owns shares of National Australia Bank Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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