"At the current price of $537.57, Mastercard's annualized dividend of $3.48 translates to a yield of approximately 0.65%. That's barely enough to offset inflation, let alone provide meaningful income. For context, the broader market offers yields closer to 1.5%, and even direct competitor Visa delivers 0.77% with its $0.67 quarterly payment. The payout ratio tells a different story. Based on trailing twelve-month earnings of $16.45 per share, Mastercard distributes just 19.15% of profits as dividends."
"The numbers clarify Mastercard's capital allocation priorities. In fiscal 2025, the company paid $2.756 billion in total dividends while simultaneously executing $11.727 billion in share repurchases. That's a 4-to-1 ratio favoring buybacks over dividends. This strategy makes mathematical sense given Mastercard's valuation. With free cash flow of $17.159 billion in 2025, the company generated 6x the cash needed to cover dividends."
Mastercard distributed $0.87 per share on February 9, 2026, a 14.5% year-over-year increase from $0.76. At a price of $537.57 the annualized dividend of $3.48 yields about 0.65%, below broader market yields and competitor Visa's 0.77%. Trailing twelve-month earnings of $16.45 per share produce a 19.15% payout ratio. In fiscal 2025 the company paid $2.756 billion in dividends and repurchased $11.727 billion of stock, a 4-to-1 buyback-to-dividend ratio. Free cash flow of $17.159 billion covered dividends six times, indicating a buyback-focused capital allocation with room for future dividend growth.
Read at 24/7 Wall St.
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