Photo: Asoko Insight
Commercial and agricultural sector firms top listed companies with the highest dividends relative to their share prices, according to data compiled by Standard Investment Bank (SIB).
ScanGroup , Williamson Tea , Kapchorua and Nation Media Group are among the top five companies listed on the Nairobi Securities Exchange (NSE) with the highest dividend yields, which is the dividend relative to the current prices.
ScanGroup has a 23.6 per cent dividend yield topping the pack, thanks to the special dividend it gave shareholders in June. The company is also set for another dividend, which is likely to keep its dividend yield high.
“For ScanGroup, the main factor in the higher dividend has been the special one that it gave this year. And we see this higher value likely to be maintained because there is also an upcoming special dividend as a result of the sale of its research division,” said Lisa Kimathi, senior associate for research at SIB.
The data shows that the two tea companies — Williamson and Kapchorua — had 15.3 and 13.3 per cent in dividend yields.
However, the price of Williamson is also a reflection of the fact that the price of the share has come down by more than 20 per cent in the last 12 months and also in the past six months. For Kapchorua, the increase in the price of the share in the past year has also been relatively low at just above six per cent compared to 17 other companies whose price has had an upward movement of more than six per cent during the same period.
Other companies on the list of top 10 in paying dividends relative to the prices of their listed shares are Kenya Reinsurance and Umeme .
Ms Kimathi said despite the high dividends for agricultural firms, the problem remains constrained supply of the securities. For a company such as Standard Chartered Bank among the top 10 in terms of dividends yields, she explained the major issue is a price too high for retail investors.