At a glance

  • WAM Capital paid 15.5c per share in dividends with ex-dates in the 12 months to 24 September 2026, and both payments were 60% franked.
  • The board has cut its FY27 Dividend target to 8.0c (4c interim plus 4c final), which equals a run-rate Yield of 6.78% at today's price.
  • A FY26 final dividend of 7.75c, 60% franked, goes ex on 8 October 2026 before the lower target kicks in.

WAM Capital (ASX:WAM) is a listed Investment company, or LIC, managed by Wilson Asset Management. Rather than running a Business of its own, it owns a portfolio of shares, with a focus on what the manager sees as undervalued growth companies. Investors buy WAM shares on the ASX and, in effect, get exposure to that portfolio and to the manager's stock-picking.

An LIC's capacity to pay dividends ultimately depends on how well that portfolio performs. Good years build up profits that can be paid out over time. years do the opposite. LICs can smooth their dividends for a while, but they cannot keep paying more than their investment returns support forever.

WAM's dividends are partly franked, at 60%. Franking credits reflect tax the company has already paid, and the level depends on how much tax WAM has paid on its own gains and income.

Why did the board cut the dividend target to 8c?

The cut came with WAM's FY26 results in late August 2026. The portfolio fell 10.5% in FY26, which put pressure on the profits available to fund dividends. The chairman acknowledged that the dividend had been set "too high".

The new FY27 target is 8.0c, made up of a 4c interim and a 4c final. At the current price of $1.18, that represents a run-rate yield of 6.78%, which is a very different proposition from the 13.14% trailing figure.

The market did not take the news well. After the cut, the shares fell to a 16-year low. That fall, in turn, helps explain why the trailing yield now looks so high: the old, larger dividends are being divided by a much lower share price.

What happens next for WAM shareholders?

There is still a final payment at the old rate to come. The FY26 final dividend of 7.75c, 60% franked, goes ex on 8 October 2026 and is paid on 21 October 2026. Investors who hold the shares before the ex-date are entitled to it.

After that, dividends are set to step down to the new target, starting with a 4c interim. Anyone comparing WAM with other income stocks should therefore focus on the 6.78% run-rate yield rather than the 13.14% trailing yield, because the trailing figure is built on dividends that have already been replaced by a lower target.

There are other risks too. The 8.0c is a target, not a guarantee, and it could move again depending on how the portfolio performs. The share price could keep falling, or recover, which would change every yield calculation. The franking level can shift as well. LIC share prices can also drift away from the value of their underlying portfolios, so the share price does not always track investment performance neatly.