Increasing Stock Market Uncertainty and Volatility Expansion
Positive Outlook on Dividend System Improvement Efforts
14 Listed Companies Expected to Pay Interim Dividends in September
[Asia Economy Reporter Myunghwan Lee] "Focus on mid-term dividend stocks."
As market uncertainty is expected to increase, there is growing attention on stocks that pay mid-term dividends. Analysts also suggest that the financial authorities' efforts to improve the dividend system will have a positive impact on dividend stocks in the future.
According to Mirae Asset Securities on the 26th, a total of 14 companies listed on the domestic stock market are expected to pay mid-quarter dividends in September. Excluding two preferred stocks among them, 12 common stocks are expected to pay mid-term dividends.
POSCO Holdings is expected to have the highest mid-quarter dividend yield in September. POSCO Holdings is anticipated to pay a mid-term dividend of 4,000 KRW per share, with a dividend yield of 1.70%. Following it are Ssangyong C&E (1.62%), SK Telecom (1.61%), and K Car (1.17%), all expected to record dividend yields in the 1% range.
Large semiconductor stocks, whose prices have recently been declining, are also predicted to pay mid-term dividends in September. Samsung Electronics is expected to pay a mid-term dividend of 361 KRW per share for both common and preferred shares (Samsung Electronics Preferred). SK Hynix is also forecasted to pay a mid-term dividend of 300 KRW per share. Additionally, financial stocks such as Shinhan Financial Group (400 KRW) and KB Financial Group (500 KRW) are expected to show decent dividend yields in the 1% range, according to Mirae Asset Securities. Financial stocks are considered representative high-dividend stocks.
Recently, the stock market has been experiencing increased uncertainty. On the 23rd, the KOSPI closed at 2,290.00, down 1.81% from the previous trading day, breaking below the 2,300 level for the first time in two months. Furthermore, the U.S. Federal Reserve (Fed) has indicated the possibility of further interest rate hikes, maintaining a hawkish stance, which is expected to increase volatility. On that day, the market dropped more than 2% in early trading, falling to the 2,240 level.
Experts have focused on the defensive strength of dividend stocks in this situation. Son Juseop, a researcher at Cape Investment & Securities, said, "Dividend styles tend to show better performance compared to the market during periods of increased market uncertainty or expected negative earnings, making them a defensive style." He added, "Given their seasonality of showing high stock price growth from September to early December, they can be an alternative to enhance portfolio defense."
Recent news that financial authorities are pushing for changes to the dividend system of domestic listed companies is also expected to have a positive impact on dividend stocks. Kim Soyoung, Vice Chairman of the Financial Services Commission, expressed the intention to improve the dividend system, which does not align with global standards, at the 'Policy Seminar to Resolve Korea Discount' held at the Korea Exchange on the 15th. Currently, domestic companies with December fiscal year-end confirm dividend shareholders at the end of December, finalize dividends at the March shareholders' meeting, and pay dividends in April.
The authorities are reportedly pushing for a change to a system where the dividend amount is decided between January and March each year, shareholders entitled to dividends are determined, and dividends are paid within one month. Regarding this, Kim Hoojung, a researcher at Yuanta Securities, said, "If the dividend system changes like in advanced financial countries, investors will receive dividends faster," adding, "It is expected to influence an increase in dividend payout ratios as dividends are fixed and investors are confirmed earlier."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
