On May 8, 2025, shares of Mercedes-Benz Group (formerly Daimler) began trading "ex-dividend," meaning that any investors purchasing shares on this date will not receive a dividend until next year. This trading status typically leads to a decrease in the stock price, expected to drop by approximately the amount of the declared dividend. However, it is important to clarify that the stock price is determined by market supply and demand, rather than being directly deducted by the dividend amount.
At the Annual General Meeting held on May 7, 2025, it was decided that the dividend for the fiscal year 2024 would be set at 4.30 EUR per share. This marks a significant decrease of 18.87 percent compared to the previous year’s dividend. The total payout to shareholders amounts to 5.49 billion EUR, reflecting a 1.26 percent reduction from the prior year.
On the day of the Annual General Meeting, the stock closed at 53.99 EUR. As trading commenced on the ex-dividend day, investors were faced with the implications of the dividend cut, which can visually impact the stock price. The dividend yield for 2024 is calculated at 7.99 percent, down from 8.47 percent in the previous year.
Over the past year, the stock price of Mercedes-Benz Group has decreased by 25.60 percent. Despite this decline, the actual return, which includes both the price drop and the dividend, has seen a lesser impact, with a real return of -14.59 percent, indicating that while the stock price has fallen, the total return from dividends has cushioned the blow.
Looking ahead, analysts from FactSet predict further challenges for shareholders. For the fiscal year 2025, they forecast a further decrease in the dividend to 3.25 EUR per share, which would result in a lower dividend yield of approximately 6.03 percent.
The stock market valuation of Mercedes-Benz Group currently stands at 52.112 billion EUR, with a price-earnings ratio of 5.28. In 2024, the company reported revenues of 145.594 billion EUR and earnings per share (EPS) of 10.19 EUR.
In comparison to its peers—Volkswagen (VW), BMW, and Porsche—Mercedes-Benz Group's performance has been mixed. While VW offers a higher dividend of 6.36 EUR, Mercedes-Benz leads in terms of dividend yield. The competitive landscape reveals that even with a reduced dividend, Mercedes-Benz Group maintains a strong position in terms of yield compared to its counterparts.
As the automotive industry continues to navigate challenges, including market fluctuations and economic pressures, the dividend adjustments reflect the company's strategic responses to current conditions. Investors will be keenly observing how these changes affect overall shareholder value in the coming months.
The implications of these financial decisions extend beyond immediate shareholder payouts. They signal to the market how Mercedes-Benz Group is positioning itself against competitors and adapting to an evolving economic environment. With the ongoing transition towards electric vehicles and sustainable practices, how the company manages its resources and dividends will be crucial in maintaining investor confidence.
In summary, the recent announcement of the reduced dividend marks a pivotal moment for Mercedes-Benz Group as it seeks to balance shareholder expectations with the realities of a competitive automotive landscape. Stakeholders will be watching closely to see how the company navigates these challenges and what further adjustments may be necessary in the future.
