Did you invest $7k in Westpac shares in 2020? If so, here's how much dividend income you've earned

Have Westpac shares really returned 36% in three years?

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Key points

  • The Westpac share price has risen 20% over the last three years to close Thursday's session at $20.60
  • Meanwhile, the big four bank has been a consistent dividend payer
  • Indeed, each Westpac share has provided $2.74 of dividend income in that time

If you bought into Westpac Banking Corp (ASX: WBC) shares three years ago, you're likely pretty happy with your investment.

Three years ago, the big four bank's stock was just lifting off its COVID-19 lows.

At that point, a $7,000 investment probably would have seen one walking away with 405 shares, paying $17.22 apiece for $6,974.10.

Today, that parcel would sell for $8,343. The Westpac share price last traded at $20.60, 20% higher than it was three years ago.

Created with Highcharts 11.4.3Westpac Banking Corporation PriceZoom1M3M6MYTD1Y5Y10YALL29 May 20202 Jun 2023Zoom ▾Jul '20Jan '21Jul '21Jan '22Jul '22Jan '23202120212022202220232023www.fool.com.au

For comparison, the S&P/ASX 200 Index (ASX: XJO) has gained 24% in that time.

But beyond share price gains, Westpac investors have also realised some decent dividends in the years since 2020. Let's take a look.

All dividends paid to those holding Westpac shares since 2020

Here are all the dividends handed to those invested in Westpac shares since June 2020:

Westpac dividends' pay dateTypeDividend amount
December 2022Final64 cents
June 2022Interim61 cents
December 2021Final60 cents
June 2021Interim58 cents
December 2020Final31 cents
Total: $2.74

As the chart above shows, each Westpac share has yielded $2.74 of dividend income over the last three years.

That means our figurative parcel has likely provided $1,109.70 of passive income in that time, leaving our imagined investor realising a total return on investment (ROI) of around 36%.

Those returns might have been bolstered even more if one were to have reinvested their dividend income, perhaps using the bank's dividend reinvestment plan (DRP).

Not to mention, all dividends provided to Westpac shareholders since 2000 have been fully franked. Thus, they might have brought extra benefits to some shareholders come tax time.

Considering Westpac's 64-cent final dividend and its 61-cent interim dividend, shares in the bank currently boast a 6.5% dividend yield.   

And investors don't have long to wait until its next offering. Westpac declared a 70-cent interim dividend last month. That will begin to hit shareholders' accounts later this month.

Motley Fool contributor Brooke Cooper 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 Scott Phillips.

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