| Market cap | R485.2B |
|---|---|
| P/E | 12.7 |
| EPS | N/A |
| Div yield | 6.18% |
| 52W high | R102.88 |
| 52W low | R74.78 |
| Volume | 1.62M |
| Listed | N/A |
Price and fundamentals data is supplied by EODHD, with Yahoo Finance as a fallback source. Sentiment is computed by StockTalk SA from 42 live member stances recorded by registered members on this page.
Investors in FirstRand LTD are focused on margin compression and dividend sustainability as key drivers of share price performance rather than sentiment, with concerns that shrinking net interest margins amid potential recession could threaten profitability and dividends that are paid twice yearly.
Summarized from 5 posts · updated nightly
Cape, the issue is real but here's what matters more right now: if FSR's margins are shrinking, the dividend gets smaller or cuts altogether, and that's what drives the share price down over time, not just sentiment. The recession angle is worth watching but the boring stuff, like whether they're still profitable enough to pay out, is what actually determines if you make money owning it.
When FirstRand makes money from lending, the board decides whether to hand some of that profit to shareholders as a dividend or keep it in the bank. If you own 100 shares and they decide to pay 50 cents per share, you get R50 in cash, simple as that.
do you think the net interest margin squeeze matters more than people are saying. fsr's making less money per rand lent out, and that's before any recession hits harder.
@fees_first_dan ja, that's the bones of it. The margin squeeze is real though, harder to make that spread when rates come down.
FSR pays a dividend a couple times a year, which is just FirstRand handing part of what it made in profit to whoever owns the shares. So if you own 100 shares and they pay a 50 cents per share dividend, you get R50 in cash. It's not guaranteed though, depends on how much they earned and what the board decides to do with it.
FirstRand makes money from banking, so they earn when you borrow money for a bond or car, and they earn the difference between what they pay you on savings and what they charge you on loans. A dividend is when they hand some of that profit to whoever owns shares, which FSR does a couple times a year.
86.91 now. Banks getting hammered today hey.
A dividend, that just means the bank hands part of its profit to whoever owns the shares, so you get paid for sitting there. FirstRand does it a couple times a year, and right now with rates where they are the payout's been decent for holders.
FirstRand makes money the same way your bank does, charging you interest when you borrow and paying you less interest when you save, then keeping the difference. They also earn fees when they help you invest your money or insure your car through Wesbank. That spread between what they charge borrowers and what they pay savers, that's their bread and butter.
FirstRand is basically a bank, so they make money by lending you money for a home or car, charging you interest, and taking deposits from savers. When they're profitable they hand out dividends, which is just their way of sharing the profit with people like us who own the shares.
A dividend is literally the bank handing you a slice of its profit just for owning the shares. FirstRand pays out twice a year, and each time you get a few rand per share depending on how much profit they made. It lands in your account on the payout date, same as pocket money.
If you want to start with FSR, step one is picking a broker. EasyEquities charges about R9.95 per trade under R1000, FNB wants R11.50, Standard Bank closer to R25. Money lands in your account same day or next morning depending which one you pick.
@cape_steel both matter. Weak demand means fewer loans to book, lower volume. Thin margins on what does exist means less profit per loan. That's a squeeze.
@cape_steel if loans aren't growing, margin pressure just means less money per loan they do make. That matters when things pick up again.
Do you think the net interest margin pressure they're facing actually matters if loan demand stays weak, or is that just noise for now?