Is the Mineral Resources a best buy for its dividend?
The post How does the Mineral Resources (ASX:MIN) dividend compare to the materials sector? appeared first on The Motley Fool Australia. –
Just last month, Mineral Resources decided to reward shareholders with a fully-franked dividend of $1.75 per share. This represented an increase of an astonishing 175% on the full year dividend of $2.75 per share.
While the company is on an attractive 5.02% dividend yield, investors may be wondering how it stacks up against its competitors.
At the time of writing, the Mineral Resources share price is up 2.65% to $54.70.
How does the Mineral Resources dividend compare to its sector?
For example, Fortescue is scheduled to pay a fully-franked dividend of $2.11 per share this month. Coupled with the previous interim dividend of $1.47, this comes to a total dividend payment of $3.58 for FY21. Based on the current Fortescue share price of $20.85, this implies a dividend yield of 17.17%.
Next up, NRW is also due to pay a fully-franked dividend of 5 cents apiece in this year’s earnings season. This brings the full-year dividend to 9 cents a pop. Based on the current NRW share price of $1.95, this gives the company a dividend yield of 4.61%.
Do analysts think the Mineral Resource share price is a buy?
A number of brokers have weighed in on the company’s share price following its full year scorecard released to the ASX.
As such, Morgan Stanley cut its rating on Mineral Resources shares by 8% to a bearish price of $45.70. The other brokers had a more bullish view with JPMorgan reducing its outlook by 2.9% to $68. Macquarie on the other hand, raised its assessment on Minerals Resources by 1.4% to a price of $74.
Based on Macquarie’s appraisal, this implies an upside of around 35.2% on the current Mineral Resources share price.
Should you invest $1,000 in Mineral Resources right now?
Before you consider Mineral Resources, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Mineral Resources wasn’t one of them.
The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
*Returns as of August 16th 2021
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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.