What’s with the Dicker Data share price today?

Shares in the hardware, software and cloud distributor are up and down today.

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Key points

  • Dicker Data shares are up and down in early morning trade
  • The company's shares are trading ex-dividend today
  • Eligible investors will receive a dividend payment of 13 cents per share on 1 June

The Dicker Data Ltd (ASX: DDR) share price is roller coasting between red and green on Monday morning.

Shares in the hardware, software and cloud distributor lifted to $12.68 before plummeting to a low of $12.33 — all in the first hour of trading today. At the time of writing, the Dicker Date share price has retraced and is now trading up 0.24% at $12.50.

This comes despite the S&P/ASX 200 Index lifting 0.78% to 7,130 points in early trading following strong Wall Street gains on Friday.

Let’s see what might be driving the Dicker Data share price today.

Shareholders lock in the Dicker Data dividend

With the first three months wrapped up for Dicker Data, investors are selling the company’s shares as they trade ex-dividend.

The IT distributor released its first-quarter market update for FY22 last Wednesday, reporting strong growth across key financial metrics.

As a result, the board elected to increase its upcoming interim dividend by 44% over the prior corresponding period.

Typically, one business day before the record date, the ex-dividend date, is when investors must have purchased shares. If the investor does not buy Dicker Data shares before this date, the dividend will go to the seller.

When can shareholders expect to be paid?

For those eligible for Dicker Data’s interim dividend, shareholders will receive a payment of 13 cents per share on 1 June. The dividend is fully franked at a corporate tax rate of 30%, which means investors will receive tax credits from this.

In addition, investors can elect the company’s dividend reinvestment plan (DRP) which will add a portion of shares to their portfolio instead. This will be based on a 10-day volume-weighted average price from 4 May to 17 May.

There is no DRP discount rate and the last election date for shareholders to opt in is on 18 May.

Under the company’s dividend policy, 100% of after-tax profits will be paid out through equal quarterly dividends.

This brings the total proposed dividends to be paid in FY22 to 54 cents per share, up 44% from FY21.

Dicker Data share price summary

Dicker Data shares are down 15% in 2022, alongside lost confidence from investors in the S&P/ASX All Technology Index (ASX: XTX).

By comparison, the benchmark for Australian technology-orientated companies is down a massive 29% over the same timeframe.

Dicker Data shares touched a year to date low of $11.60 last Tuesday, before sharply rebounding in the following days.

Based on today’s price, Dicker Data commands a market capitalisation of roughly $2.16 billion and has a trailing dividend yield of 3.33%.

Motley Fool contributor Aaron Teboneras has positions in Dicker Data Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Dicker Data Limited. The Motley Fool Australia has positions in and has recommended Dicker Data Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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