The Yancoal Australia Ltd (ASX: YAL) share price is having a treacherous day, sending investors to flee for the hills.
Just yesterday, the energy producer’s shares accelerated to a multi-year high of $5.39 on the back of positive investor sentiment.
However, Yancoal shares have backtracked to $4.32, down 16.92% at the time of writing.
Let’s take a look at what could be driving the company’s shares south today.
Why are Yancoal shares falling?
Following the company’s full year results release on 28 February, investors are eyeing Yancoal shares as they go ex-dividend today.
Historically, when a company reaches its ex-dividend day, its shares tend to fall in proportion to the dividend paid out. This is because investors tend to sell off the company’s shares after securing the dividend.
Furthermore, the sudden price weakness in coal has also attributed to the company’s share price being lower today.
It appears that even with the war between Russia and Ukraine, commodity prices have recently cooled off.
The latest price fetching for a tonne of coal is US$361.75, a drop of 1.87% for the day.
Although when comparing from 7 March record highs of US$435, coal has shed more than 14% in value.
What does this mean for Yancoal shareholders?
For those eligible for Yancoal’s final dividend, shareholders will receive a payment of 70.4 cents per share on 29 April. Although, the dividend is unfranked, which means investors won’t receive any tax credits from this.
Management reinstated the dividend due to the company’s strong cash earnings and lower gearing in FY21. This came on the back of record coal prices realised throughout the financial year.
The $930 million final dividend represents a payout ratio of 118% of profit after tax.
Yancoal share price snapshot
Since the beginning of 2022, the Yancoal share price has shot up by roughly 66%.
In the last 12 months, its shares have further accelerated, up around 83%.
Yancoal commands a market capitalisation of roughly $5.7 billion with roughly 1.32 billion shares on its books.
The post Why is the Yancoal (ASX:YAL) share price plummeting 17% today? appeared first on The Motley Fool Australia.
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More reading
- ASX 200 (ASX:XJO) midday update: Uniti jumps on takeover speculation, Rio Tinto and Yancoal tumble
- These ASX 200 shares trade ex-dividend tomorrow. Here’s what you need to know
- Want to secure this monster ASX coal share dividend? Here’s what you need to do next week
- Why the Ukraine crisis is shining the spotlight on ASX coal shares
- Here are the top 10 ASX shares today
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.
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