ASX tech shares have been on a rollercoaster in 2022. Volatility has picked up this year as inflation increases and interest rates rise to try to calm down economic demand. But, with the share prices falling, it's having an interesting effect on dividend yields.
Not only does a lower share price mean that the investment is cheaper, it also boosts the potential dividend yield for investors.
REA Group is invested in a number of local and international property sites. In Australia, it operates portals like realestate.com.au and realcommercial.com.au.
For example, if a business with a 4% dividend yield sees a 10% drop in the share price, then the dividend yield would become 4.4%.
So, with that in mind, let's look at some of the ASX tech shares that do pay dividends but have seen a sell-off.
REA Group Limited (ASX: REA)
With both economic volatility and increased uncertainty about the property market, the REA Group share price has dropped almost 30% this year.
In FY22, the full-year dividend increased by 25% to $1.64 per share. At the current REA Group share price, it offers a trailing grossed-up dividend yield of 1.9%.
By FY24, the business could be paying a full-year dividend of 208.8 cents per share, according to CMC Markets. That would translate into a grossed-up dividend yield of 2.4%.
TechnologyOne Ltd (ASX: TNE)
TechnologyOne is a large ASX tech company that develops and provides a global enterprise resource planning (ERP) solution. It's working hard on changing clients onto software-as-a-service (SaaS) contracts and services.
Since the beginning of 2022, the TechnologyOne share price has dropped by more than 12%.
In the FY22 half-year result, the business decided to grow its interim dividend by 10% to 4.2 cents per share. The trailing 12 months of dividends come to a grossed-up dividend yield of 1.6%.
By FY24, TechnologyOne could pay an annual dividend per share of 22 cents per share. That could equate to a grossed-up dividend yield of 2.5%.
Carsales.Com Ltd (ASX: CAR)
Carsales claims to be the largest online automotive, motorcycle, and marine classifieds business in Australia. It has operations across the Asia Pacific region and interests in leading online automotive classifieds businesses in Brazil, South Korea, Malaysia, Indonesia, Thailand, and Mexico.
Since the start of 2022, the Carsales share price has dropped by more than 17%. That's despite the ASX tech company seeing a lot of purchasing demand for vehicles.
In the FY22 result, Carsales announced that its final dividend per share would increase by 9% to 24.5 cents. That brought the full-year dividend to 50 cents per share, which was a rise of 5.25%.
By FY24, the business could be paying an annual dividend of 67.3 cents per share. This could translate into a grossed-up dividend yield of 4.7%.
