Why is the Newcrest share price having such a lowsy end to the week?

Newcrest Mining Ltd (ASX: NCM) shareholders might be wondering why the share price is looking to finish the week lower.

The gold miner posted its FY2022 results last Friday, reporting losses across key financial metrics.

Subsequently, the board elected to slash its final dividend to US 20 cents per share.

At the time of writing, the Newcrest share price is down 2.43% to $18.44 apiece.

Let’s take a look below at why its shares are falling during trade on Friday.

What’s weighing down Newcrest shares?

Following the release of the company’s full-year results last Friday, investors are offloading Newcrest shares as they go ex-dividend today.

The ex-dividend date is particularly important as it determines which shareholders will receive the company’s latest dividend.

If you held Newcrest shares at yesterday’s market close, you will be eligible for the fully franked final dividend.

Typically, when a company’s shares trade ex-dividend, the share price tends to fall in proportion to the dividend paid out. However, this can vary depending on how the market is tracking for the day as well as investor sentiment.

For those eligible for Newcrest’s final dividend, you will receive a payment of US 20 cents per share on 29 September.

This brings the total FY2022 dividend to US 27.5 cents per share, reflecting a 50% cut from the US 55 cents per share declared in the prior corresponding year.

Under the capital management framework, Newcrest is targeting a total annual dividend payout of 30-60% of free cash flow generated for the financial year. The annual total dividends are expected to be at least US 15 cents per share on a full-year basis.

You can also elect for the dividend reinvestment plan (DRP) which will add a portion of shares to your portfolio instead. This will be based on a 5-day volume-weighted average price (VWAP) from 31 August to 6 September.

There is no DRP discount and the last election date to opt in is on 30 August.

Newcrest share price summary

In 2022, the Newcrest share price has come under strong selling pressure as the price of gold continues to retreat. Its shares are down 25% year-to-date.

In comparison, the S&P/ASX 200 Resources (ASX: XJR) sector has treaded the other way, up 9% over the same period.

Based on today’s price, Newcrest commands a market capitalisation of approximately $16.47 billion and has a dividend yield of 3.56%.

The post Why is the Newcrest share price having such a lowsy end to the week? appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Friday
• Hoping to bag the next Newcrest dividend? Here’s what you need to do
• These ASX 200 shares will trade ex-dividend tomorrow
• Can the gold price outshine sticky inflation?
• Why did the Newcrest share price just slump to a 6-year low?

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 Scott Phillips.

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