The Fortescue Ltd (ASX: FMG) dividend declared this earnings season was by far the most impressive of the three major ASX 200 mining shares.
The interim Fortescue dividend for 1H FY24 is a fully franked $1.08 per share, which is 44% higher than the interim dividend of FY23.
That's some significantly turbocharged passive income, and it also represents one of the biggest dividend boosts of all the ASX 200 shares this earnings season.
Based on the current Fortescue share price of $25.91, the interim dividend yield is 4.17%. That's higher than the 4% average that most ASX 200 stocks pay over an entire 12-month period.
By comparison, Rio Tinto Ltd (ASX: RIO) announced a fully franked final dividend of US$2.58 per share for 2H FY23, which is up 14%. That's $3.97 in Australian currency at the time of writing.
Based on the current Rio Tinto share price of $124.96, that's a yield of 3.18%.
BHP Group Ltd (ASX: BHP) cut its interim dividend by 20%. The 'Big Australian' will pay a fully franked interim dividend of 72 US cents per share for 1H FY24, or $1.11 in Aussie terms.
Based on the current BHP share price of $44.81, that's a yield of 2.48%.
Why did Fortescue pay more?
One reason is that Fortescue's earnings were superior, in terms of growth, to BHP and Rio Tinto.
This was partly because Fortescue is an iron ore pure-play stock. Therefore, it benefitted more from the strong iron ore price.
By comparison, BHP and Rio are diversified miners. Weaker commodity prices for the other metals and minerals they dig up impacted their earnings.
What's next for the Fortescue dividend?
Of course, Fortescue and the other two major ASX 200 miners will pay another dividend later in the year.
The consensus forecast published on CommSec today is for Fortescue to pay a final dividend of $1.09 for 2H FY24.
That will mean a total full-year dividend of $2.17 per share and a total yield of 8.37%.
Analysts predict a significant dividend drop in 2025 and 2026
The Fortescue dividend forecast for 2025 is much lower at $1.495 per share.
For investors buying Fortescue shares at today's price of $25.91, the 2025 forecast dividend represents a yield of 5.77%.
For 2026, the forecast Fortescue dividend is $1.03 per share, equating to a yield of 3.97%.
