Nestle Foods Nigeria Plc, the West African nation’s largest food company by market value, headed for the lowest close in a month after its final dividend disappointed investors.
The stock fell 4.8 percent to 420 naira as of 10.43 a.m. in Lagos, the lowest since Jan. 23. Nestle Foods Nigeria, a unit of Nestle SA, the world’s largest food company, will pay a 11.05 naira per share final dividend, increasing the total for 2011 to 12.55 naira per share, the company said Feb. 21 in a statement sent to Bloomberg by the Nigerian Stock Exchange in an e-mail.
The dividend announcement has “discouraged a lot of investors,” David Adonri, chief executive officer of Lambeth Trust & Investment Co., a Lagos-based brokerage, said by phone today. “It is too small compared with its price.”
The dividend Nestle is paying translates into a yield of 2.8 percent based on the Feb. 21 closing price of 441 naira, compared with a 16.89 percent yield on the country’s 364-day treasury bills, according to data from the Central Bank of Nigeria Feb. 9. The company’s shares have declined 5.8 percent this year while the Nigerian Stock Exchange All-Share Index retreated 1.7 percent.