Invested $7,000 in Rio Tinto shares 5 years ago? Here's how much passive income you've earned

Have Rio Tinto shares really returned 115% in just five years?

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Key points
  • The Rio Tinto share price has gained around 56% since March 2018 to close Friday's session at $114.43
  • Meanwhile, the company has been paying out consistent dividends 
  • Indeed, it's offered a total of around $41.88 per share over the last five years 

The Rio Tinto Ltd (ASX: RIO) share price has outperformed the S&P/ASX 200 Index (ASX: XJO) over the last five years, gaining 56% in that time.

The stock has lifted from around $72.70 in late March 2018 to trade at $114.43 as of Friday's close.

That means a $7,000 investment in Rio Tinto shares back then would likely have seen an investor walk away with 96 of the iron ore giant's stocks.

Today, that parcel would be worth $10,985.28. And that's before considering the dividends paid over the same period.

For comparison, the ASX 200 has gained around 21% over the last five years.

Let's dive into all the dividends provided to Rio Tinto shareholders during that time.

A woman sits at her computer with her hand to her mouth and a contemplative smile on her face as she reads about the performance of Allkem shares on her computer

Image source: Getty Images

All dividends paid to those holding Rio Tinto shares since 2018

Here are all the dividends paid to those holding Rio Tinto shares since March 2018, rounded to the nearest cent:

Rio Tinto dividends' pay dateTypeDividend amount
September 2022Interim$3.84
April 2022Final and special$5.77 and 86 cents
September 2021Interim and special$5.09 and $2.51
April 2021Final and special$3.97 and $1.20
September 2020Interim$2.16
April 2020Final$3.50
September 2019Interim and special$2.19 and 89 cents
April 2019Final and special$2.51 and $3.39
September 2018Interim$1.71
April 2018Final$2.29
Total: $41.88

All up, Rio Tinto investors have likely received $41.88 of passive income for each share in the iron ore producer they've held since this same date in 2018.

That means our figurative $7,000 investment has probably yielded around $4,020.48 in dividends over its life, leaving it with a total return on investment (ROI) of approximately 115%.

And that's before considering the franking credits that have been attached to all the company's offerings, potentially bringing tax benefits over the years.

Not to mention, one may have realised an even greater return if they were to have reinvested their dividends, thereby employing the power of compounding.

Rio Tinto will pay its upcoming final dividend – worth $3.26 per share – on 20 April.

Right now, the mining favourite's stock offers a 6.2% dividend yield.

Motley Fool contributor Brooke Cooper 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.

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