If you're an income investor, then the Wesfarmers Ltd (ASX: WES) dividend might be of interest.
Historically, the conglomerate shares a decent portion of its profits with shareholders each year, providing them with an above-average dividend yield.
Will this trend continue in the future? Let's take a look at what one broker is expecting from the Wesfarmers dividend in the coming years.
Wesfarmers dividend forecast
First things first, in FY 2022, Wesfarmers paid shareholders a fully franked $1.80 per share dividend. So, with the Wesfarmers share price currently fetching $46.37, this equates to a 3.9% dividend yield.
Unfortunately, according to a recent note out of Goldman Sachs, its analysts are expecting the Wesfarmers dividend to go backwards for a couple of years.
In FY 2023, the broker is forecasting a $1.70 per share fully franked dividend. This equates to a 3.65% dividend yield for income investors. This reduction is expected to be driven by a combination of weaker earnings in FY 2023 due to margin pressures offsetting solid revenue growth and a lower payout ratio of 85%.
For similar reasons, the broker is then forecasting a reduction to $1.63 per share in FY 2024. This will mean a fully franked 3.5% dividend yield for that year.
Finally, in FY 2025, Goldman expects a return to both profit and dividend growth. Its analysts are forecasting a fully franked $1.80 per share dividend for investors that year. Based on the latest Wesfarmers share price, this equates to a fully franked 3.9% dividend yield.
In summary, that will be fully franked dividends per share of $1.70 in FY 2023, $1.63 in FY 2024, and then $1.80 in FY 2025. Which equates to yields of 3.65%, 3.5%, and 3.9%, respectively.
