Hoping to pocket the next Rio Tinto dividend? Read this

Rio Tinto's shares will soon trade ex-dividend for its next payout.

| More on:

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

Key points
  • Last month, Rio Tinto released its full-year results
  • The mining giant reported a decline in profits due to weaker commodity prices and higher costs
  • This put pressure on the Rio Tinto final dividend, which will be paid in the near future

When it comes to dividends, there are few larger than the Rio Tinto Ltd (ASX: RIO) dividend.

In light of this, it is no surprise that the mining giant is a big favourite of income investors.

But if you want to receive its next dividend payment, you will have to get a wriggle on.

Miner holding cash which represents dividends.

Image source: Getty Images

Rio Tinto's FY 2022 results

Last month, the mining giant released its full-year results for FY 2022.

In case you missed it, for the 12 months ended 31 December, the miner reported a 13% decline in revenue to US$55,554 million and a 41% reduction in net profit after tax to US$12,420 million.

This reflects the unfavourable movement in commodity prices, the impact of higher energy and raw materials prices on its operations, and higher rates of inflation on operating costs and closure liabilities.

The Rio Tinto dividend

Unfortunately, with Rio Tinto's profits under pressure, the miner was forced to slash its dividend.

The Rio Tinto board elected to cut its fully franked final dividend by 46% to US$2.25 per share, bringing its full-year dividend to a total of US$4.92 per share in FY 2022.

Rio Tinto's full-year dividend is a 38% reduction on what was paid a year earlier and equates to a total payout of US$8 billion. This represents a payout ratio of 60% of underlying earnings.

While the miner's interim dividend has been and gone, it isn't too late to receive its final dividend, which currently equates to a ~2.7% yield.

Rio Tinto's shares will trade ex-dividend on Thursday 9 March. This means that investors have today and tomorrow's session to buy shares if they want to be eligible to receive it on the payment date of 20 April.

Goldman Sachs would approve of buying Rio Tinto's shares. As covered here, yesterday the broker added Rio Tinto to its conviction list with a buy rating and $140.40 price target.

Motley Fool contributor James Mickleboro 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 has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Dividend Investing

Australian dollar notes in the pocket of a man's jeans, symbolising dividends.
Broker Notes

Why this quality ASX dividend share is tipped to surge 55%

A leading broker expects this ASX stock could rocket 55% atop paying two annual dividends.

Read more »

Happy dad watching tv with kids, symbolising passive income.
Dividend Investing

3 ASX dividend shares I'd buy for reliable passive income

I think building income from ASX shares starts with choosing the right types of businesses.

Read more »

A mature aged man with grey hair and glasses holds a fan of Australian hundred dollar bills up against his mouth and looks skywards with his eyes as though he is thinking what he might do with the cash.
Dividend Investing

Is this one of the best ASX passive income stocks to buy right now?

This business is paying a great level of income…

Read more »

Hand of a woman carrying a bag of money, representing the concept of saving money or earning dividends.
Dividend Investing

1 ASX dividend stock down 43% I'd buy right now

This business is a leading idea for passive income!

Read more »

Australian notes and coins symbolising dividends.
Dividend Investing

$1,000 buys 100 shares in an incredibly reliable ASX 200 dividend stock

This business has been very resilient and still looks like a great buy.

Read more »

Woman holding $50 notes with a delighted face.
Dividend Investing

Why this ASX dividend share is a retiree's dream

This stock can offer investors everything they want in retirement.

Read more »

Man holding Australian dollar notes, symbolising dividends.
Dividend Investing

Why ASX dividend investing still works for building long-term wealth

Here's a strategy that continues to deliver results for investors.

Read more »

Happy young woman saving money in a piggy bank.
Dividend Investing

How to build a $10,000 annual income with ASX shares

For me, building income is less about chasing yield and more about consistency, quality, and time.

Read more »