How much is the next NAB dividend?

National Australia Bank Ltd (ASX: NAB) is one of the largest dividend payers on the ASX.

It has a market capitalisation of around $105 billion, according to the ASX.

It is one of the big four ASX banks, alongside Commonwealth Bank of Australia (ASX: CBA), Australia and New Zealand Banking Group Ltd (ASX: ANZ), and Westpac Banking Corp (ASX: WBC).

So what can shareholders expect from the next NAB dividend? Let’s take a look.

How big is the next NAB dividend going to be?

NAB’s dividend has been recovering after the impacts of the COVID-19 pandemic.

In 2020, both of its dividends were $0.30 per share. The first half of FY21 saw an interim dividend of $0.60 per share. NAB increased the dividend again with the final dividend of $0.67. That brought the FY21 full-year dividend to $1.27 per share.

Many analysts believe the NAB dividend in FY22 will be increased again.

Commsec numbers, provided by third-party external data vendors, suggest the NAB dividend could increase by more than 13% to $1.44. That would represent a forward grossed-up dividend yield of 6.4% at NAB’s Thursday closing share price of $32.47.

There are different brokers with varying estimates for the NAB dividend in FY22.

Macquarie currently rates NAB as a buy, with a price target of $32.50. However, its dividend expectations for the bank are lower than the estimate on Commsec for FY22. Macquarie’s forecast for the FY22 grossed-up dividend yield is 6%. Macquarie suggests that bank margins could remain pressured by competition.

The broker Morgan Stanley thinks NAB will pay a grossed-up dividend yield of 6.2% in the current financial year.

Ord Minnett has one of the more optimistic views on the company’s potential dividend. It thinks the NAB grossed-up dividend yield could be 6.44% in FY22.

UBS may have one of the biggest predictions for the NAB dividend out of all the brokers. The broker has pencilled in a dividend which translates into a potential grossed-up dividend yield of 6.6%.

What do we know about the upcoming NAB half-year result?

NAB’s half-year result is due to be released on 5 May.

Two months ago, the bank announced its first-quarter update. NAB said it generated $1.8 billion of cash earnings. This represented cash earnings growth of 9.1% year on year. Cash earnings before tax and credit impairment charges were up 6%.

NAB said volumes were “strong” over the quarter, with lending and deposits each up $18 billion. In Australia, over the three months to December 2021, home lending grew 2.6%, and small and medium enterprise (SME) business lending increased by 3.4%. Its market share of core lending and deposit products increased. New Zealand loan growth was “strong” at 2.2%.

NAB said it was optimistic about the outlook for Australia and New Zealand. The CEO said the bank is well-positioned to continue to grow with a strong balance sheet and disciplined execution of a clear strategy.

It recently completed a $2.5 billion share buy-back and announced a further buy-back of another $2.5 billion.

The post How much is the next NAB dividend? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison 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 recommended Macquarie Group Limited and Westpac Banking Corporation. 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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