Smiling young man sitting in cafe and checking messages, with his laptop in front of him. I like high-yielding shares that can help me build my passive income streams. Many UK dividend shares offer low to mid-single digit percentage yields, although there are some double-digit yielders around. But after crashing 30% in trading today, one FTSE 100 share offers a 20%+ dividend yield right now!
Should I act and buy it for my portfolio? Mining giant
The share in question is miner Evraz (LSE: EVR). The steel producer is best known for its mines in Russia, but it does have operations in other countries including Ukraine and the US.
So, why has the market pummelled Evraz shares in today’s trading session? In short, mounting political concerns about Ukraine and Russia are hurting investor sentiment on the company. There are concerns that political developments could impede Evraz’ ability not only to produce steel but also to sell it on the world markets. Sellers have been offloading their Evraz positions, pushing its already unusually high yield up to an incredible 26%.
In other words, if I buy the shares now and the dividend remains at the current level then in just four years I will already have covered my purchase price. Anything else would be pure profit. Is a 20%+ dividend yield sustainable?
The $64,000 question is contained in that little word “ if ”. Will Evraz maintain its dividend, making today’s price crash the buying opportunity of a lifetime for my portfolio? Or does the unbelievably high yield signal market expectations of tumbling profits leading to a dividend cut at the miner?
First, it is worth noting that Evraz does have a strong recent dividend history. Last year, it paid out 95c of dividends. Although that was almost double what it paid out the […]
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