As an ASX dividend share, APA Group (ASX: APA) has some fine credentials under its belt. Firstly, this gas pipeline operator was one of the relatively few dividend shares not to give its investors a pay cut during the pandemic. Yes, APA increased its 2020 dividend from 2019 levels, and then increased it again in 2021. Many ASX blue-chip shares, including all of the big four banks, can’t say the same.
Indeed, the company’s latest dividend, its interim payment doled out last month, came in at 25 cents per share. That was another increase on the previous interim dividend of 24 cents per share.
But not just that, APA has now built up a 10-year streak of consecutive annual dividend increases. That’s actually a rather rare feat on the ASX. Only a handful of other ASX shares, such as Washington H. Soul Pattinson and Co Ltd (ASX: SOL), can beat it.
So with APA’s dividend credentials established, many investors might wonder if they can take advantage of this history and participate in a dividend reinvestment plan (DRIP) with their APA shares.
A DRIP is an offering made by some companies to their investors. It allows said investors to receive additional shares in the company instead of receiving their dividends in cash. The company buys additional shares on the behalf of the investor at an amount equal to what they would have received in cash. This is usually done with no brokerage costs and allows investors to roll dividends back into new shares to potentially enhance the effects of compounding.
Does the APA dividend offer a reinvestment plan?
Many ASX shares, especially blue-chip shares, offer DRIPs to their investors. Some even offer a discount to those investors who want to use the DRIP.
So let’s take a look and see if APA is one of those companies.
Unfortunately for DRIP fans, APA does not currently operate a dividend reinvestment plan for its investors. The company has done so in the past but ceased its DRIP in mid-2013.
This means that APA investors today have no option other than receiving their dividends in cash. Perhaps APA will resume its DRIP sometime in the future. But for now, it’s cash that is king when it comes to APA’s dividends.
At the latest APA share price, this ASX 200 blue chip has a dividend yield of 4.12%.
The post Does APA Group have a dividend reinvestment plan? appeared first on The Motley Fool Australia.
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More reading
- Here’s what happened to the APA share price in March
- 2 defensive ASX dividend shares offering reliable income
- Why did the APA (ASX:APA) share price just ink a new 52-week high?
- The APA (ASX:APA) share price is up $1 in 7 years. Have the dividends been worth it?
- Are analyst upgrades on the way for APA (ASX:APA) shares?
Motley Fool contributor Sebastian Bowen owns Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns and has recommended APA Group and Washington H. Soul Pattinson and Company Limited. 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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