AMP Ltd (ASX: AMP) shares are once again offering investors some welcome passive income.
The S&P/ASX 200 Index (ASX: XJO) financial stock has been struggling over recent years.
The wealth manager last paid out a dividend back in October 2020.
But in a sign things may finally be turning around, the board declared a final dividend of 2.5 cents per share, 20% franked, when the company announced its full-year results on 16 February. This will have hit shareholdersâ bank accounts on 3 April.
Thatâs not quite enough to make up for the 4.2% fall in AMP shares over the past year. But with the partial franking credits, it comes close.
How much passive income will my $8,000 June investment in AMP shares have yielded?
AMP shares are currently trading for $1.09 apiece.
That works out to a trailing yield of 2.3%.
On the day the AMP board declared its revived dividend, shares closed at $1.14.
ASX 200 investors who were drawn by the renewed dividend payment and bought on that day will be earning a yield of 2.2%. Or $175 in passive income from an $8,000 investment.
But if Iâd been brave and bought shares near the lows on 30 June, I could have bought the stock for 96 cents per share.
Now my yield on those same AMP shares has grown to 2.6%.
And Iâd have earned a very welcome $208 in passive income from that investment already.
Not to mention realising a 14% share price gain, which would have seen me bank capital gains of another $1,083.
Now admittedly Iâm cherry-picking the AMP share lows from last June with the benefit of hindsight. And a tumbling stock may, of course, continue its slide after you buy in.
But if you do manage to buy in near the lows â via good luck, extensive research, or perhaps good investing advice â it can really boost your passive income stream for as long as you hold that stock.
The post If Iâd invested $8,000 in AMP shares in June hereâs how much passive income Iâd be earning today appeared first on The Motley Fool Australia.
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More reading
- How did the AMP share price manage to surge 8% in April?
- AMP shares are finally heading upwards, but will it last?
- Here are the top 10 ASX 200 shares today
- Why AMP, EML, Pilbara Minerals, and Telix shares are racing higher today
- AMP share price marching higher as net outflows ebb
Motley Fool contributor Bernd Struben 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 Scott Phillips.
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