Own Medibank (ASX:MPL) shares? Here's all you need to know about the latest dividend

While Medibank's bottom line missed the mark, investors are banking on the dividend.

| More on:
a woman looks down at her phone with a look of concern on her face and her hand held to her chin while she seriously digests the news she is receiving.

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

Key points

  • The Medibank share price erased almost 4% on the back of the company's half-year results
  • The board declared a fully franked interim dividend of 6.1 cents per share
  • Eligible shareholders can expect their dividend payment on 24 March

Medibank Private Ltd (ASX: MPL) shareholders might be feeling frustrated after the company's share price tumbled 6% over the last week.

The private health insurer released its half-year results for the 2022 financial year, reporting single-digit increases across key metrics.

Nonetheless, the board opted to increase its upcoming interim dividend to eligible investors.

Let's take a look below at what you need to know.

What's the deal with Medibank interim dividend?

The Medibank share price backtracked late last week, which appears to have been caused by an underwhelming performance.

In total, the company will be paying out 6.1 cents per share for the 6 months ended 31 December 2021. That's 5% higher than last year's interim dividend for financial year 2021.

Furthermore, the payout ratio for the latest dividend is at 78.5% (in line with the target range of 75% – 85%).

Management noted that the full-year dividend for FY22 is expected to be towards the top end of the above target range.

The higher dividend came despite Medibank's net profit after tax (NPAT) falling 2.7% to $220.2 million over the first half. It noted that a $40.9 million, or 57% decrease, in net investment income dragged down the company's bottom line.

When can shareholders expect to be paid?

Medibank will pay the interim dividend to eligible shareholders next month on 24 March.

However, to be eligible you'll need to own Medibank shares before the ex-dividend date on Friday 4 March. This means if you want to secure the dividend, you will need to purchase Medibank shares by Thursday 3 March at the latest.

It is worth noting that on the ex-dividend day, the share price traditionally falls in proportion to the dividend amount.

In addition, the dividend is fully-franked which means that investors will receive tax credits when tax time comes along.

Currently, Medibank has a dividend trailing yield of 4.16% and a market capitalisation of roughly $8.4 billion.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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 Bruce Jackson.

More on Dividend Investing

Woman looking at prices for televisions in an electronics store.
Dividend Investing

3 ASX dividend shares with surprisingly large yields today

These stocks have yields that might shock you.

Read more »

Middle age caucasian man smiling confident drinking coffee at home.
Dividend Investing

Brokers say these ASX dividend shares are top buys

These shares have been given the thumbs up by analysts.

Read more »

A couple lying down and laughing, symbolising passive income.
Dividend Investing

I'd buy 9,600 shares of this ASX 200 stock to aim for $200 a month of passive income

Want regular income? This could be a great stock to buy.

Read more »

Happy young couple saving money in piggy bank.
Dividend Investing

Buy these strong ASX dividend stocks for passive income

Brokers rate these shares as buys for passive income.

Read more »

A man thinks very carefully about his money and investments.
Dividend Investing

Buy Fortescue and these fantastic ASX dividend shares with $5,000

These shares have been named by brokers as buys for income investors. Let's see what they offer.

Read more »

an older woman holds a handful of paper money in her hands and looks at them with a slightly crazy smile on her face wearing her spectacles on a string as a lot of older people do.
Dividend Investing

I rate these 2 high-yield ASX dividend stock as buys

These businesses could pay big passive income.

Read more »

Woman and man calculating a dividend yield.
Dividend Investing

With the 13% dividend yield, is the GQG share price a buy?

This stock has a huge dividend yield. Does it offer more than that?

Read more »

an older couple look happy as they sit at a laptop computer in their home.
Dividend Investing

Forget term deposits and buy these ASX dividend stocks

Analysts think these shares could be top alternatives to term deposits.

Read more »