Meta’s Brand-New Dividend Will Make You This Much Richer

You already could get rich holding shares of Meta Platforms (META). And now a brand-new dividend is just a bonus.




X



The social media giant Thursday announced plans to pay its first-ever quarterly dividend, of 50 cents a share. That’s an annual total payout of $4.4 billion, ranking Meta 31st in the S&P 500 for total annual payout, says Howard Silverblatt of S&P Dow Jones Indices.

Meta’s dividend is also big enough to boost the S&P 500 yield by 0.74%, to 1.46% from 1.45%, he says. And that’s on top of the stock’s nearly 160% gain in the past year. Plus, the stock jumped more than 10% in after-hours trading on the news.

But what does it mean for you?

Meta’s Dividend In S&P 500 Perspective

At first glance, Meta’s dividend looks small. It’s a dividend yield of just 0.51%. That ranks just 380th among the S&P 500 in terms of yield. It’s also a fraction of the S&P 500’s 1.46% yield.

But if you look at it in other ways, it’s significant. For one thing, Meta’s dividend is the twelfth largest in the communication services sector. That might not sound like much in a group with 19 stocks. But keep in mind this is a group with some of the highest yielding S&P 500 stocks, like Verizon (VZ) with a 6.3% dividend.

But this Meta dividend has growth potential. It still has plenty of upside as the company sits on $61 billion in cash and short-term investments. Plus, it’s found money to distribute to investors buying the stock for capital appreciation only.

Just ask CEO Mark Zuckerberg.

Mark Zuckerberg’s Huge Payout

Meta said the dividend will be paid on both classes of stock. And that’s a giant windfall for  Zuckerberg.

The annual dividend payout to Zuckerberg alone will total a staggering $694 million a year. That’s thanks to the Meta founder still owning nearly 350 million shares or 13.5% of the company. But big ETF investors will score, too. Vanguard’s annual Meta dividend haul will amount to $366.5 million.

Not bad for a new dividend.

Biggest Meta Dividend Winners

Meta investor Shares owned (millions) Annual dividend ($ millions)
Mark Zuckerberg 347.0 $694.0
Vanguard 183.2 $366.5
BlackRock 156.0 $311.9
FMR 125.1 $250.2
Capital Research 97.6 $195.2
Sources: S&P Global Market Intelligence, IBD