Spain and Italy will lead the dividend yield in Europe during 2023

The IBEX 35 It stands out among the main European markets, at least as far as dividend yield is concerned. The most important index of the Spanish parquet will offer a return for investors of 4.72% throughout this 2023. This makes it the second most attractive option to invest in the financial markets of the Old Continentwho have started the exercise somewhat more animated after the storm you’ve been through variable income.

Only Italy’s FTSE Mib is ahead, according to Bloomberg analyst consensus data, which grants an estimated remuneration of 5.15% for this year. The market projects an increase in return for shareholders of 0.85 points for the companies listed in this Italian index, while in Spain the rise is one point compared to 2022. With a historical average of 4% in a period of three decades, the Spanish stock market is among those with the highest dividend yield traditionally granted, according to data from the Spanish Stock Exchanges and Markets (BME). For this year the forecast is that it will exceed this figure and be placed above 5% in 2024, something that will also happen in Milan.

This situation relegates French CAC and German DAX to third and fourth place, whose dividend yield is reduced to 3.38% and 3.42%, respectively. Remuneration represents one of the main points of connection with the shareholder, but it is also key to attracting new ones after twelve months in which sales have prevailed in the face of the uncertainty unleashed as a result of the Russian invasion of Ukraine, an inflation runaway and the resurgence of interest rates after an anomalous decade for monetary policy.

The Spanish ‘pay-out’ of 2022 is one of the least generous

The scenario changes when analyzing the proportion of profits that the listed companies have distributed or plan to do so among their shareholders charged to the 2022 accounts. In this case, the companies in the Ibex remain at the tail of the most ‘splendid’ when compared with the rest of the companies that operate in the most important European markets. Specifically, the ‘pay-out’ has reached 37.72% in 2022, behind 38.95% of the 40 companies that make up the CAC. The DAX companies, for their part, will jointly distribute 41.35% of their profits, pushing Italy to lead the classification, with 42.87%.

Although in the most cases its distribution will be effective Throughout this year, there are cases in which it is paid in the same year, so some payments may have already been made. The 35 companies paid a total of 26,000 million during 2022the highest figure since 2019 and 26% more than in 2021. The European Central Bank (ECB) limited the distribution of dividends for banking entities at the height of the health crisis, a measure that lasted until September 2021. This sector has a great weight within the Spanish index, so the variation in the percentage may have been conditioned.

Although cash dividends represent the most widespread formula among the policies of remuneration, the ‘scrip dividend’, the return of share premiums or share repurchases are also being considered as alternatives. Precisely the capital reduction has gained popularity in the past year, especially among the banking sector, which has deployed ‘megaprograms’ such as BBVA’s, although in its case it has been motivated by excess capital. After what CaixaBank has completed its plan for 1,800 millionCurrently, the only one in force is Banco Santander. The entity chaired by Ana Botín has 1,000 million to get its own titles until next January 31.

Spain and Italy will lead the dividend yield in Europe during 2023