Royal Mail: your dividend income could hit 8.5pc next year
Could more have been raised from the sale of Royal Mail? Could the proceeds have been invested more effectively in bolstering the capacity of the rural Post Office network? This article says:
Royal Mail shareholders who took part in its recent flotation could see the income from their shares hit 8.5pc next year, City experts say.
This is because the dividend paid by the company in 2015 could rise dramatically thanks to its ability to generate cash from its business.
Many investors were encouraged to buy Royal Mail shares by the attractive dividend on offer. At the flotation price of 330p a share, the dividend yield was forecast to be 6.1pc. If the dividend jumps as much as some City analysts expect, their income should be even bigger next year.
Even people who buy at today’s share price of 587p could expect a healthy yield of 4.8pc in 2015 if the dividend rises as predicted. Today’s buyers should receive 3.5pc for this year.