Some of the return from owning a share doesn't come from the share price going up at all — it comes from cash the company pays you directly. Today you'll learn to measure that cash return: dividend yield.
When you own a share, you can make money from it in two separate ways:
Lessons 15 and 16 focused on earnings and price (EPS, P/E) — both about whether a share is priced sensibly relative to what the company earns. Today's lesson is about the cash that actually lands in your pocket while you wait for that price story to play out. The measure for that is called dividend yield.
Dividend yield = Dividend per share ÷ Current share price, expressed as a percentage. It answers: "if I bought this share today, what percentage of my purchase price would I get back this year, just in dividends, before any change in the share price itself?"
Safaricom pays its dividend semi-annually (twice a year). As of mid-July 2026, its most recent declared dividend per share was KES 0.85, and its share price was about KES 35.95.
Do the division:
But Safaricom pays twice a year, so a single payment understates the full annual picture. Measured on a trailing twelve-month (TTM) basis — adding up all dividends paid over the last 12 months — Safaricom's dividend yield works out to about 4.17%. For the full 2025 financial year specifically, the yield was about 7.27%, with a payout ratio of 83.68% (meaning Safaricom paid out about 84 shillings of every 100 shillings of profit as dividends, keeping only the rest to reinvest in the business).
A single semi-annual payment (2.4%) and a trailing-twelve-month total (4.17%) are both correct — they're just answering slightly different questions. "What did the last payment alone yield?" versus "What have I actually received over the last full year, added up?" Always check which one you're looking at before comparing two companies, or comparing the same company across time.
Equity Group's most recently declared annual dividend, from its FY2025 results, was KES 5.75 per share (ex-dividend date 25 May 2026). Its share price was about KES 86.75 as of 15 July 2026.
The KES 5.75 dividend above is from Equity Group's FY2025 results — more recent than the FY2024 figures used in earlier lessons (where the confirmed dividend per share was KShs 4.25). We're using the FY2025 figure here because dividend yield needs the most recent declared dividend to be meaningful — an old, stale dividend paired with today's price would understate what a buyer today would actually expect to receive going forward. Whenever you compute a yield yourself, check the date the dividend was declared, not just the amount.
| Safaricom (SCOM) | Equity Group (EQTY) | |
|---|---|---|
| Most recent annual dividend per share | ~KES 0.85 (semi-annual; TTM ~4.17% yield) | KES 5.75 (FY2025, declared 2026) |
| Share price used | ~KES 35.95 (mid-July 2026) | ~KES 86.75 (15 July 2026) |
| Approximate dividend yield | ~4.2% (TTM) | ~6.6% |
Source: Safaricom PLC Annual Report and Financial Statements 2024 (safaricom.co.ke) for historical financials; dividend and price figures as of mid-July 2026 from market data aggregators (stockanalysis.com, mystocks.co.ke, tradingview, african-markets), illustrative and subject to change — always verify against the company's own investor relations page before relying on a figure.
On these numbers, Equity Group's dividend yield looks higher than Safaricom's. That's a genuine, useful observation — but resist the urge to declare Equity Group "the better investment" from this one number alone. A higher yield can mean a company is generous with cash and healthy, or it can mean the share price has fallen a lot (which mechanically pushes yield up) for reasons that should worry you. Yield alone never tells you which situation you're in — you need the fuller picture from ratios and statements you've already learned to read.
Two things to keep in mind before you ever act on a yield number:
You now have three separate lenses on a share price: EPS (Lesson 15, how much profit belongs to each share), P/E (Lesson 16, how expensive the price looks relative to that profit), and now dividend yield (how much cash you're paid while you hold the share). None of the three, alone, tells you whether a share price is "justified." Together, they start to.
Next lesson, we'll put everything together in a full worked walkthrough on Safaricom — applying every ratio and red flag from this course to reach a reasoned view on whether its current market value looks justified by the fundamentals.
Primary source for this lesson's historical financials: Safaricom PLC Annual Report and Financial Statements 2024. For a beginner-friendly explanation of dividend yield and payout ratio, see Investopedia's "Dividend Yield".
You've now met every ratio in this course — margins, ROE, current ratio, debt-to-equity, EPS, P/E, and dividend yield. The Ratio Cheat Sheet reference card collects every formula with its worked example in one place.
Something unclear, or want to dig into a line item we skipped (like "how a company decides how much dividend to pay")? Ask your teacher — that's what these sessions are for.