Do Adairs shares really boast a 9% dividend yield?

It’s another rough day for the Adairs Ltd (ASX: ADH) share price, adding to the stock’s recent turmoil.

At the time of writing, the Adairs share price is $1.995. That’s 2.68% lower than its previous close and 50% lower than at the start of 2022.

For context, the S&P/ASX 200 Index (ASX: XJO) is gaining 0.2% today and has slipped 11% year to date. The All Ordinaries Index (ASX: XAO) is also up 0.2% and nearly 13% lower than it was at the start of this year.

But there’s a notable silver lining for the home furnishing retailer’s shares. The stock’s downturn has left it trading with a dividend yield of 9%.

Adairs shares offer a 9% dividend yield

Considering the current Adairs share price and the company’s two latest dividends totalling 18 cents per share, the stock is boasting a 9.02% dividend yield.

Adairs announced it would pay investors a 10-cent final dividend for financial year 2021 in August 2021. Then, in February, it declared an 8-cent interim dividend.

Both dividends were fully franked. That means they provide shareholders with even more value at tax time.

Additionally, Adairs offered a dividend reinvestment plan (DRP) for its most recent payout. That allowed some investors to receive their dividends in the form of new shares rather than cash – thereby cost-effectively increasing their holding in the company.

The last time the market heard price-sensitive news from the retailer was the release of its half-year results in February.

Then, the company noted COVID-19 outbreaks had dinted its earnings. Plenty of eyes will likely be on Adairs in coming months to see if the inflationary environment and interest rate hikes have also taken a toll on its bottom line.

The post Do Adairs shares really boast a 9% dividend yield? appeared first on The Motley Fool Australia.

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More reading

• Why I think these 2 ASX shares are trading at bargain basement prices
• The Adairs share price is down 54% in 2022. What’s happened?
• Why did the Adairs share price surge 5% today?
• Is Adairs really going to pay a dividend yield of 21%?
• Down 20% in a month: Top broker tips 75% upside for the Adairs share price

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended ADAIRS FPO. The Motley Fool Australia has positions in and has recommended ADAIRS FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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