How often do shares pay out dividends?

Shares are known for paying out dividends to investors, but how often do shareholders receive dividends from their investments?

a woman

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

One of the biggest benefits of owning shares is that they pay dividends. But how often do shares pay out dividends?

When we think about interest earned from a bank like Commonwealth Bank of Australia (ASX: CBA) we get interest every month. But dividends don't work like that.

Most Australian companies only pay a dividend every six months to align with their half-year reporting periods. For example, Australia's biggest miner BHP Group Ltd (ASX: BHP) reports its half-year report for the six months to 31 December and the full year to 30 June. BHP then pays its six-monthly dividend three months after the reporting period ends in March and September.

There are some other companies that report for the six month periods to June and December, but have different payment cycles. For example, Sydney Airport Holdings Pty Ltd (ASX: SYD) pays its dividends in February and August.

Different businesses have different 12-month reporting periods. Australia and New Zealand Banking Group (ASX: ANZ) reports its full year to 30 September, so it pays its dividend in December and July.

There are some companies and real estate investment trusts (REIT) that pay quarterly not half-yearly. For example, Rural Funds Group (ASX: RFF) pays in January, April, July and October. Arena REIT No 1 (ASX: ARF) pays in February, May, August and November. Dicker Data Ltd (ASX: DDR) pays in March, June, September and December.

If you wanted to, you could construct a portfolio of good shares that pay in different months so that you receive at least one payment in every month.

However, there are a small number of shares that actually aim to pay out a dividend every single month like BetaShares Australian Dividend Harvester Fund (ASX: HVST), although the total returns have been disappointing from this fund since inception, and Contrarian Value Fund Ltd (ASX: CVF).

Foolish takeaway

Over the course of a whole year it doesn't really matter when payments are made, but it can help with cashflow if the payments are spread out. I'm most interested in businesses that have reliable dividends and will generate growth.

Motley Fool contributor Tristan Harrison owns shares of RURALFUNDS STAPLED. The Motley Fool Australia owns shares of and has recommended Dicker Data Limited, RURALFUNDS STAPLED, and Sydney Airport Holdings Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Dividend Investing

Woman smiling whilst shopping in a clothing store.
Dividend Investing

Why this quality ASX 300 dividend stock is tipped to surge 54%

A leading fund manager forecasts significant outperformance from this quality ASX 300 dividend stock.

Read more »

Man smiling at a laptop because of a rising share price.
Dividend Investing

Why this is one of my top ASX dividend shares to buy in June

This ASX dividend share provides everything I’m looking for.

Read more »

A happy young couple lie on a wooden deck using a skateboard for a pillow.
Dividend Investing

Forget Westpac and buy these ASX dividend shares

Let's see what analysts are saying about these income options.

Read more »

Two smiling work colleagues discuss an investment or business plan at their office.
Dividend Investing

Brokers say Harvey Norman and these ASX dividend stocks are buys

Let's see what brokers are recommending as buys for income investors.

Read more »

Happy man holding Australian dollar notes, representing dividends.
Dividend Investing

Analysts say these ASX dividend stocks are top buys for income investors

Let's see which stocks are being tipped as buys.

Read more »

Man holding Australian dollar notes, symbolising dividends.
Dividend Investing

Buy these ASX dividend shares for 4% to 11% yields

Analysts expect these buy-rated shares to offer great dividend yields.

Read more »

fingers walking up piles of coins towards bag of cash signifying asx dividend shares
Dividend Investing

I think these 2 ASX dividend stocks are buys for income in June

These businesses can provide solid income for investors.

Read more »

A businesswoman weighs up the stack of cash she receives, with the pile in one hand significantly more than the other hand.
Dividend Investing

Why I think this is the best ASX dividend share to own

This business has so many positive attributes…

Read more »