The New Hope Corporation Ltd (ASX: NHC) share price is having a tough start to the week.
In morning trade, the coal miner's shares are down almost 9% to $5.91.
Why is the New Hope share price sinking?
While the market may be a sea of red again following another market selloff, that's not the main reason for the weakness in the New Hope share price.
The real reason that the coal miner's shares are falling so heavily today is because they are trading ex-dividend.
When a share trades ex-dividend it means that the rights to an upcoming dividend are now settled. As a result, any investors who are buying its shares today won't be entitled to receive this dividend when it is paid.
Given that dividends are part of a company and built into its valuation, its share price will tend to drop on the ex-dividend date to reflect this. After all, a buyer of its shares wouldn't want to pay for something that they won't receive.
The New Hope dividend
There are actually a couple of dividends that the New Hope share price is trading ex-dividend for today.
Last month, the company released its full-year results and reported a 10.6% increase in net profit after tax to $1,087.4 million. This allowed the New Hope board to declare a fully franked final dividend of 21 cents per share.
But with New Hope swimming in cash and having no debt on its balance sheet, the company elected to pay a special dividend of 9 cents per share. This brought its total dividends for the second half to 30 cents per share and 70 cents per share for FY 2023.
Based on the New Hope share price at Friday's close, this equates to dividend yields of 4.6% and 10.8%, respectively.
Eligible shareholders can now look forward to receiving the 30 cents per share dividends in a couple of weeks on 7 November.