If you want to receive the upcoming Rio Tinto Ltd (ASX: RIO) dividend, then you will have to get a wriggle on.
Thatâs because the mining giantâs shares will be trading ex-dividend on Thursday.
When a share trades ex-dividend, it means the rights to an imminent dividend payment are settled and new buyers of its shares will not be entitled to it.
Instead, the seller will receive the dividend on the payment date even though they no longer own those shares.
So, with Rio Tinto shares trading ex-dividend on Thursday, investors have until the close of play on Wednesday to get on the minerâs share register if they want to receive this payout.
But what is Rio Tinto paying?
The Rio Tinto dividend
Last month, Rio Tinto released its half-year results. It reported a 10% decline in revenue to US$26.67 billion and a 25% drop in underlying earnings before interest, tax, depreciation and amortisation (EBITDA) to US$11.73 billion. This was driven by a combination of lower commodity prices and higher costs.
Unfortunately, in light of this earnings decline, it was inevitable that the Rio Tinto dividend would have to be cut.
The Rio Tinto board declared a fully franked interim dividend of US$1.77 (A$2.62) per share for the six months. This was down 33% on the prior corresponding period.
Based on the current Rio Tinto share price of $113.94, this will mean a yield of 2.3% from this interim dividend alone.
If you do own or buy Rio Tinto shares, you can look forward to receiving this dividend next month on 21 September. After which, the companyâs final dividend is likely to be declared in February and then paid to eligible shareholders in March.
As things stand, Goldman Sachs expects the final dividend to come in at US$1.72 (A$2.62) per share. This will bring its full-year dividend to US$3.49 per share.
Goldman currently has a conviction buy rating and a $126.90 price target on its shares.
