This year's shareholder meeting season, a series of businesses announced to pay cash dividends at record high rates, with some businesses setting dividend rates of up to 350% of the par value of shares. For investors, if they buy the right stocks of successful businesses, the profit will be higher than saving.
Investor season awaits dividends
Dividends are net profits paid for each share in many forms: cash, shares, other assets. Among these forms of dividend payment, cash payment is always the most awaited by shareholders.
Mr. Manh Thang (47 years old, Ba Dinh District, Hanoi) has been participating in the stock market for 15 years. With a long-term investment perspective, Mr. Thang said: "I care more about the financial health and development prospects of the company and prioritize receiving dividends over making quick profits. Because the rate of businesses I choose often has a dividend payout ratio significantly higher than the savings interest rate".
Sharing the same view, Ms. Nguyen Thanh Phuong (43 years old, Dong Da District, Hanoi) has invested in MCH (Masan Consumer) shares for nearly 3 years to receive dividends. She emphasized: "Investing in shares to receive dividends helps me limit risks more than continuously trading shares. It doesn't matter whether the company is big or small, the main thing is to observe and analyze the company's business activities and growth trends in each stage, it can be slow but sure".
List of businesses that pay generous cash dividends
Looking back at this year’s shareholder meeting season, among the businesses paying cash dividends, many businesses announced plans to pay dividends at a rate higher than 100% of the par value of the shares. These are mainly businesses from the manufacturing, retail, and service industries.
The current market leader in dividend payout ratio belongs to Tan Tien Plastic Packaging JSC ( stock code TTP, UPCoM stock exchange) when it announced a plan to pay cash dividends in 2023 at a rate of up to 350%. This means that each share receives 35,000 VND. If you own 1,000 shares, the investor will pocket 35 million VND.
Tan Tien Plastic Packaging Company and recent stock price movements of TTP
After a long period of stagnation, TTP shares are showing quite positive developments, reaching a market price of 123,400 VND/share. The breakthrough appeared on May 13th when the dividend payment was announced, increasing from 81,890 VND/share to 116,440 VND/share.
In addition, many businesses also paid dividends at a rate of over 100%. Profit increased dramatically by 25.6 times compared to the same period last year, reaching 482.6 billion VND, Vinexad Advertising and Trade Fair Joint Stock Company (VNX, UPCoM) paid 2023 cash dividends at a rate of 150%. Thus, shareholders will receive 15,000 VND/share. This is the company's highest dividend rate in the past 14 years. In previous years, the company always paid dividends regularly at 20-70% per year.
Recently, with many consumer products, prepackaged goods receiving positive responses from the market, Masan Consumer Corporation ( MCH , UPCoM ) achieved a 20% increase in after-tax profit compared to the same period last year. Since then, MCH announced a cash dividend at a rate of 100% (1 share receives 10,000 VND).
Business developments at Masan Consumer over the years
Source: MCH Financial Statements
To achieve the above results, MCH said that by increasing advertising and promotion costs to develop new innovations, increase recognition, thereby boosting the group's sales, mainly in the spice, convenience food and beverage industries, along with controlling production costs, MCH increased gross profit. In addition, net financial income also increased by 25%.
In addition, Masan Consumer is planning to list MCH shares on the HOSE.
Western Bus Station Joint Stock Company (WCS, HNX) paid cash dividends at a rate of 160% (1 share receives 16,000 VND). The company paid to shareholders on March 28.
Previously, the Board of Directors had decided to pay dividends for 2023 based on actual business results, not lower than 20%. Therefore, this rate is much higher than the original plan.
This development is believed to come from the positive business results in 2023, with revenue reaching more than 140 billion VND, an increase of nearly 50%. Profit after tax has since increased to 66.5 billion VND, an increase of 75% over the same period, a record high since 2020. Thanks to that, WCS exceeded the annual plan by 17% in revenue and 50% in profit, respectively.
This trend continued into the first quarter of this year when the number of visitors increased sharply during the Lunar New Year, WCS achieved 39 billion VND in revenue, up 14.2%, and after-tax profit in the first quarter reached 19.3 billion VND, up 21.2% over the same period.
Obviously, if you invest in successful businesses, in addition to the increase in the market price of stocks, the cash dividends distributed to many stocks are not small. However, in the current stock market, besides businesses that spend a lot on dividends, there are also a series of businesses that have not paid dividends to shareholders for decades. Therefore, investing in stocks is attractive but also very risky. That is completely different from having savings deposits. Therefore, which way to choose depends on the taste of investors.
Source: https://phunuvietnam.vn/dau-tu-nhan-co-tuc-chung-khoan-loi-hon-gui-tiet-kiem-20240530184147626.htm
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