News Alert: JD.com (9618 HK/ JD US) – First time cash dividend since listing
• The board approved its first time cash dividend of US$0.63 per share, or US$1.26 per ADS
• The aggregate amount of the special dividend is approximately US$2bn
• Equivalent to 2% dividend yield
• Expect +ve share price reaction
• Find out more at Insights Direct:
What’s New
– JD.com approved a special cash dividend of US$0.63 per share, or US$1.26 per ADS, according to HKEx announcement on 4 May 2022.
– The aggregate amount of the special dividend will be approximately US$2bn.
– Note that, on 21 April 2022, company had announced a board meeting to discuss potential distribution of special cash dividend.
– The payment date is expected to be on or around June 8, 2022 and June 14, 2022 for holders of ordinary shares and ADSs respectively.
Our View:
– The news is positive to the share price.
– This is JD.com’s first cash dividend distribution since listing in 2014. It comes after Tencent’s announcement of distributing 14.7% of issued shares (457m ordinary shares) of JD.com as interim dividend in Dec 2021.
– The special dividend is equivalent to c.2% dividend yield (based on US closing price of US$63 as of 4 May).
– The move signals the company’s confidence on its healthy financial position and long-term growth.
– We currently rate BUY on JD.com with TP of US$105/HK$409.