Which companies will pay their shareholders more than anyone else?

Dividend yield on the Russian market remains one of the highest among the developing countries and is 6%, if the sample is included in the sample from the RTS index. What papers should I pay attention to?
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Since April 2018, securities of Russian issuers are under pressure of geopolitical and sanctions risks. This applies not only to the stock market, but also to the public debt. According to the Bank of Russia, from April 1 to June 1 this year, the share of non-residents in OFZ decreased from 34.5% to 30.5%, which corresponds to an outflow of 228 billion rubles.

However, the dividend yield on the Russian market remains one of the highest among the developing countries and is 6%, if we include in the sample companies from the RTS index. And for some issuers, this figure even exceeds 10%. In addition, the volume of dividends in monetary terms has been steadily increasing since 2014.

In 2018, the total volume of dividend payments of public companies may grow by 15% yoy and reach 1.8 trillion rubles. The main reasons for the increase in dividends are the government's demand to increase the payments of state companies to 50% of net profit, as well as the transition of a number of issuers to the calculation of these payments on the basis of free cash flow.

Despite the fact that a number of the largest companies have already transferred dividends for the results of 2017, shares of many issuers continued to decline after passing the cutoffs, thereby creating even more interesting conditions for long-term investments.

What to look for

The most important when choosing dividend stories is not the size of the dividend yield of the company relative to the Central Bank's key rate, but the business prospects on the horizon for at least one year and the desire of the majority shareholder to share a part of the profit with minority shareholders.

Among the shares of the banking sector should pay attention to the dividend strategy of the industry leader - Sberbank. Despite the fact that the company has already paid dividends for the period of 2017 at the rate of 12 rubles for ordinary and preference shares, at the moment the quotes of both types of shares have been adjusted to a larger amount than the dividends, which makes the position of investors that were not included in the dividend cut- even more profitable.

In addition, according to management plans, the net profit of Sberbank by 2020 should reach 1 trillion rubles, and the dividend payout ratio should increase to 50% of net profit, if the capital of the first level is 12.5%.

Thus, with a net profit of 800 billion rubles in 2018 and a dividend share of 35%, the dividend yield on preferred shares of Sberbank in a year may be 7-8% to the current quotes.

What payments are forthcoming

Among dividend stories in the metallurgical sector is worth highlighting "Norilsk Nickel". The company traditionally pays dividends twice a year, directing 60% of EBITDA on them, provided the ratio between net debt is maintained and this ratio is less than 1.8.

In July, the company will transfer 607.98 rubles per share for 2017, which, taking into account the interim payments, will ensure a yield of 9%. In this case, the shareholders of the company with a high degree of probability can expect a high dividend yield and in 2018. The basis for this will be a rise in nickel prices and the weakening of the ruble, which will lead to an EBITDA increase of 35%, even despite the potential increase in capital expenditures.

Gazprom, like most other representatives of the oil and gas sector, pays dividends in mid-July. At the end of 2017, the payment will be 8.04 rubles per share, which is equivalent to a yield of 5.8%. The company still does not comply with the Finance Ministry's request to allocate 50% of its net profit for dividends because of the need to finance the construction of the Nord Stream-2, Turkish Stream and Siberia-Siberia gas pipelines.

The greatest dividend yield in the oil and gas sector will be provided by Bashneft's preferred shares. The issuer will pay 158.95 rubles per share, which means a yield of 9.2% to the current quotation.

In the electricity distribution grid sector, it is worth highlighting FGC UES, whose dividends yield a yield of 8%. At the same time, the decision to buy out 10% of the shares of Inter RAO, owned by FGC UES, from the subsidiary of IRAO "Inter RAO Capital" and IC Region will bring the company 34.8 billion rubles. These revenues will allow FGC UES to reduce net debt by 17%, to 169 billion rubles.

Among the most attractive dividend ideas are Aeroflot shares. At the end of June, the Board of Directors approved payments for the year 2017 at a rate of 12.8 rubles per share, or 50% of net profit under RAS, which corresponds to a yield of 9.1%.

However, the operating performance of the leader of civil air transportation in Russia is negatively affected by the high cost of oil, which leads to an increase in costs. As a result, the shares of the company after the cut-off will be difficult to recover in the short term, which once again confirms the expediency of analyzing the dynamics of the issuer's financial results on the horizon of the year before making a decision to purchase the share in dividends.