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Online Share Trading

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Dividend

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KVW
Super Contributor
A 102% paying dividend? How can this be correct?
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10 REPLIES 10
Maggie
Super Contributor
Simon, is this correct, surely not?
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SimonPB
Valued Contributor
the R217 dividend is correct (as per the sens). They have sold off their 25% holding in Toyota and are paying out the proceeds, not sure if there is anything left in the company after that?
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Not applicable
Wesco's only asset was a stake in Toyota SA, which they have now sold. The special dividend is a distribution of the proceeeds of the sale. The share is correctly priced as it will be worthless (no underlying investments) once the dividend has been paid.
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barry_1
Super Contributor
Read Company Profiles,it would seem as if they sold their share of Toyota SA to the Japanese main company.Then it is not a dividend in the main sense of the word but a return of capital which they decided to return to share holders as they have no use of it themselves.Beware as then the company will be worth less after the deal by the amount they pay out. OMO
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Not applicable
So in short, if you buy their shares at R217 you'll get your capital back, BUT will pay TAX on it seeing that it is a dividend...
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SimonPB
Valued Contributor
the R217 is after tax as tax is at source.
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KVW
Super Contributor
So After the LTD the share price will be zero, because what ever you sell it for after the LTD is Profit?
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Maggie
Super Contributor
Why is this share price rising, doesn't make sense?
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john_1
Super Contributor
OK.. I did not say this but, anybody who has made any profits in the last tax year now has a fabulous gap... caluculate your profits. buy the exact amount of wesco. the div is payed = no tax and you take the capital loss wiping out all taxable gains.. TAX free money for taxable money.... You got to love the market and what it gives you.
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Maggie
Super Contributor
Thank You John, now it makes sense.
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