Here's the Rio Tinto dividend forecast through to 2026

Here's what analysts are forecasting for the miner's dividend.

| More on:
A female miner wearing a high vis vest and hard hard smiles and holds a clipboard while inspecting a mine site with a colleague.

Image source: Getty Images

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

Rio Tinto Ltd (ASX: RIO) shares have long been a popular option for income investors.

And it isn't hard to understand why.

The mining giant generates billions of dollars in free cash flow each year. It then uses this cash to reward its shareholders with dividend payments.

And while the size of the dividend may change regularly in response to commodity prices, the yields on offer with its shares are usually significantly greater than the market average.

This looks set to be the case again in 2024 following the release of the miner's full-year results.

Last week, Rio Tinto's board released its results and declared a fully franked final dividend per share of US$2.58 per share (A$3.96 per share). This was a 14.7% increase on the prior corresponding period and brought its full-year dividend to US$4.35 per share (A$6.67 per share).

Based on the latest Rio Tinto share price, this equates to yields of 3.2% for its final dividend and 5.4% for the full year.

But what's next for the Rio Tinto dividend?

The good news for income investors is that there could be bigger dividends to come from Rio Tinto in the coming years.

According to a note out of Goldman Sachs, its analysts are now forecasting a modest increase to US$4.39 per share (A$6.73 per share) in FY 2024. This will mean a fully franked 5.45% dividend yield for investors.

A larger increase is expected in FY 2025, with Goldman expecting the miner to pay out US$4.61 per share (A$7.07 per share). If this proves accurate, it would mean a yield of 5.7% for investors.

Finally, in FY 2026, the broker expects the Rio Tinto dividend to be trimmed to US$4.55 per share (A$6.98 per share). This will still mean an attractive fully franked 5.65% dividend yield.

Goldman Sachs has a buy rating and $138.30 price target on the miner's shares.

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 positions in and has recommended Goldman Sachs Group. 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 Share Market News

Fancy font saying top ten surrounded by gold leaf set against a dark background of glittering stars.
Share Gainers

Here are the top 10 ASX 200 shares today

Let's also take a look at what the various ASX sectors were doing this Wednesday.

Read more »

Two male ASX 200 analysts stand in an office looking at various computer screens showing share prices
Broker Notes

Top brokers name 3 ASX shares to buy today

Here's what brokers are recommending as buys this week.

Read more »

A young women pumps her fists in excitement after seeing some good news on her laptop.
Share Gainers

Why Argosy Minerals, Immutep, Pointsbet, and Regis Resources shares are racing higher

These shares are having a strong session on Wednesday. But why?

Read more »

A young man clasps his hand to his head with his eyes closed and a pained expression on his face as he clasps a laptop computer in front of him, seemingly learning of bad news or a poor investment.
Share Fallers

Why Chalice Mining, Cleanaway, Kogan, and Perpetual shares are sinking today

These ASX shares are having a tough time on Wednesday. But why?

Read more »

Man looking at his grocery receipt, symbolising inflation.
Share Market News

Why the ASX 200 just crumbled on today's inflation print

ASX 200 investors are hitting the sell button following the latest Australian inflation news.

Read more »

man grimaces next to falling stock graph
Share Fallers

Why did this ASX 100 stock just crash 11%?

Cleanaway shares have been on a crazy roller-coaster over the past 24 hours.

Read more »

a man in a british union jack T shirt hurdles high into the air with london bridge visible in the background.
Mergers & Acquisitions

Nick Scali shares halted amid $60m capital raising and UK expansion news

This furniture retailer has its eyes on the UK furniture market.

Read more »

An arrogant banker pleased with himself and his success winks at his mobile phone while taking a selfie
Share Market News

Are ASX 200 bank shares like CBA 'too expensive' right now?

Are banks overpriced or good value today?

Read more »