Yield calculations on DigitalLook

[Wizard]

I am looking to build a high yield portfolio of equities along HYP lines (at the moment most of my investments are fixed interest and preference shares). I am using DigitalLook to do some initial screening. On most shares they give a current and forecast dividend yield, but I have been unable to find specifics of how these are calculated in detail, so I wanted to check if anyone here can confirm how they calculate the yields they quote on their site.

For current yield do they use the most recent full year dividend and the share price at that moment in time? Or, if for example the company has paid an interim in the current financial year would they take the current year's interim, add that to the prior year's final to come up with a dividend to use with the share price at that point in time?

For forecast yield do they take the markets estimates of the next full year's dividend and use the current share price to calculate the yield? Or would they also use a hybrid of most recent interim and forecast final? Finally, are there circumstances where they use any assumption on share price to amend it from the current share price at the point they make their calculation?

I know these are basic questions, but I would be grateful for any answers, as I want to ensure I understand the data before I make a decision based on it.

Terry.

[StepOne]

I don't think the forecast yield figures change that often on Digitallook. In fact there were times earlier this year when they did not change for weeks, possibly month. It was discussed at the time on the Fool

http://boards.fool.co.uk/digitallook-fo ... e#13335684

and

http://boards.fool.co.uk/dl-forecasts-u ... e#13338161

Even when the figures did get updated, it seemed that they used the closing price from the previous Friday in the calculations. And that the calculations were different depending which page you were looking at (e.g. whether you were looking at an individual company page, or at the listing of constituents for an entire index).

I did send an email to Digitallook at the time, and I think other people (e.g. DiamonedEcho) also contacted them, but I'm not aware that anyone ever heard back.

In short, the Digitallook yield figures are probably not to be trusted, and it's best to work out your own in a spreadsheet. At least then you know how it was done.

StepOne

[Gengulphus]

I've never managed to work out how DigitalLook calculate their yields, and long ago gave up even trying... Just get the dividend you're interested in and the share price, and do the division yourself - it's far easier!

If it's the historical yield you're interested in, watch out for companies that declare their dividends in foreign currencies: DigitalLook will give the dividend in the declaration currency, so their dividend figure will need currency conversion. That might be a case in which doing the dividend-and-price-to yield calculation oneself wasn't so good - were it not for the fact that DigitalLook have a bit of a record of failing to do currency conversions when needed... :-(

Gengulphus

[funduffer]

On most shares they give a current and forecast dividend yield, but I have been unable to find specifics of how these are calculated in detail, so I wanted to check if anyone here can confirm how they calculate the yields they quote on their site.

Terry.

I don't know about DL, but this site shows how the calculation is done:

http://www.dividenddata.co.uk/dividendy ... et=ftse100

Just click on the little arrow at the end of each line.

FD

[Breelander]

I've never managed to work out how DigitalLook calculate their yields...

Me neither.
The only thing I'm reasonably sure of is that they only seem to update the calculation once a week - possibly after Friday's close, certainly some time over the weekend.

[Wizard]

Many thanks all. I already have a basic spreadsheet where I am capturing basic financial details on candidate shares and I will drop actual dividend amounts into that and make the yield column a calculated one.

Terry.

[Wizard]

On most shares they give a current and forecast dividend yield, but I have been unable to find specifics of how these are calculated in detail, so I wanted to check if anyone here can confirm how they calculate the yields they quote on their site.

Terry.

I don't know about DL, but this site shows how the calculation is done:

http://www.dividenddata.co.uk/dividendy ... et=ftse100

Just click on the little arrow at the end of each line.

FD

Just had an opportunity to take a look at the link you posted. Very helpful little site, many thanks for posting.

Terry.

[Itsallaguess]

I've never managed to work out how DigitalLook calculate their yields...

Me neither.

The only thing I'm reasonably sure of is that they only seem to update the calculation once a week - possibly after Friday's close, certainly some time over the weekend.

I think that's true of the 'Forecast Yield' figures, but not of the 'Latest' yield figure, but firstly I should state that I'm specifically posting here regarding the yield figures shown for a share on Digital Look in their 'Key Financials / Income & Efficiency' sections, which I'll post a few links to below.

I've done some research in the past in this area, and posted about it back on the TMF boards, but my previous checks (and the ones below) suggest that the 'Latest' yield figures are always based on the previous 12-month dividend values, set against the current share price.

As two examples, having just checked, here's both sets of information for both Vodafone and Greene King -

Vodafone 12-month dividend = 11.45p (http://www.dividenddata.co.uk/dividend-yield.py?epic=VOD)
Vodafone current share price = 206.55p
Vodafone current Digital Look 'Latest' yield = 5.5% (http://www.digitallook.com/equity/Vodafone_Group)
Calculation verification = 11.45p/206.55p = 5.543%

Greene King 12-month dividend = 32.05p
Greene King current share price = 743.5p
Greene King current Digital Look 'Latest' yield = 4.3%
Calculation verification = 32.05p/743.5p = 4.31%

I won't manually check any more, but having done some separate checks in the past and verified the same information, I'm always happy to use the 'Latest' yield figures above from Digital Look, with the obvious caveat that we then need to make ourselves aware if there's been any actual notifications from the company with regards to a material change in their dividend policy since the release of their last 12-months dividends...

With regards to the 'Forecast Yield' figures, I think they are updated less regularly, and StepOne has posted links to discussions around that data in an earlier post on this thread. I think the conclusion we came to was that they were, certainly at that time, not being updated 'regularly enough' for some people, who wanted much more up to date data, but that they were still useful as a guide with the caveat again being if a particular company has released RNS releases to the market stating material changes to their dividend policy.

Personally, I think people sometimes worry a little too much with regards to the odd percentage point here and there of a company-yield figure, and we need to remind ourselves that it's the overall portfolio-yield that's the single most important figure determining the actual income we'll receive from our invested cash.

My opinion, given that 'Portfolio-income' view, is that individual portfolio-component yields will both move around often enough not to make them something I don't give too much attention to, but also on top of that, given the blended overall 'Portfolio yield' being important to me, it's important to remember that so long as we've got enough diversification in that portfolio, then small movements in the yield of individual components simply won't affect the overall portfolio-yield enough for it to be all that important, given a fair wind.

On top of that, market prices move often enough and far enough to be able to affect any calculated yield in the same margins as some people worry about getting to with these yield figures, and given that we've no control over those prices I think there's little point in worrying too much about a 10th of a percentage point here and there.

I still choose to use the Digital Look 'Forecast Yield' figures for all my income calculations for the coming year. I've done this over enough years now, and checked against the future 'delivered income', that I know that it's a forecast-income calculation that's both worth doing for me, and accurate enough to be a good guide to future income.

When it comes to share purchases, I will not rely on any free-data figures, and I will manually calculate yield figures based on known previous 12-month figures, and also one taking account of any 'announced but not paid' figures, making a 'trailing 12-month yield' figure.

I should also add that StepOne found another set of yield figures on the Digital Look website (http://www.digitallook.com/index/FTSE_100/forecast) that contained yield data that looked all over the place at the time of previous discussions. I'm not sure if that data is any more reliable now than it was then, and I'm not that bothered to find out given that I'm happy with my current data-sources, but I only mention this because we got confused during those previous discussions regarding just which set of data people were talking about, so I thought that give this is the first proper 'Digital Look yield data' discussion that's gone on under the Lemon Fool boards, that I thought I should get all the above out of the way in one post, just in case we all need to come back to this debate over the coming years....

Cheers,

Itsallaguess

[DiamondEcho]

I don't think the forecast yield figures change that often on Digitallook. In fact there were times earlier this year when they did not change for weeks, possibly month. It was discussed at the time on the Fool ...I did send an email to Digitallook at the time, and I think other people (e.g. DiamonedEcho) also contacted them, but I'm not aware that anyone ever heard back.

Nope, I never heard back from them.
IME DL have several issues that cross over each other, incl not regularly updated base data. They also seem to habitually exclude anything like Special Divs, or a capital return programme, even where that is pre-announced to run a on published frequency/sum for 5 years ahead! So historically with DL base-data I've treated it with great caution, and manually rechecked the yield myself [data from the PLCs own website] when ever there is a big move in the stock price or new div announced.

Fundfuffer's suggestion of http://www.dividenddata.co.uk/dividendy ... ld&order=1 is great.
The way their explicitly lay out the calculation too is really nice, and gives comfort it's accurate. For the record it appears to work off the prior sessions closing price but... no problem! And for the first time this site is the only one I've seen with an 'Include/exclude Special divs' toggle-button that actually works. BKG/Berkely [capital return programme per ^] and LRE/Lancashire [periodic and often material Special divs] appear to be spot on as far as I can tell.

Thanks FF, I think finally I've found a source I can reply on without having to rework the yield from the bottom-up each time!

[tjh290633]

In the past I've found them to have problems with quarterly dividend and dividends quoted in other currencies than GBP. For that reason I always go to the company web site for reliable information. The same applies to ADVFN.

TJH

[ElectronicFur]

Fundfuffer's suggestion of http://www.dividenddata.co.uk/dividendy ... ld&order=1 is great.
The way their explicitly lay out the calculation too is really nice, and gives comfort it's accurate. For the record it appears to work off the prior sessions closing price but... no problem! And for the first time this site is the only one I've seen with an 'Include/exclude Special divs' toggle-button that actually works. BKG/Berkely [capital return programme per ^] and LRE/Lancashire [periodic and often material Special divs] appear to be spot on as far as I can tell.

The owner of the dividenddata.co.uk website is very responsive to questions, and after I queried one of the calculations and inclusion of specials for some companies and not others, he added the special dividends toggle without any prompting. I've been using it for some years now, and not found any problems with the data.

[DiamondEcho]

The owner of the dividenddata.co.uk website is very responsive to questions, and after I queried one of the calculations and inclusion of specials for some companies and not others, he added the special dividends toggle without any prompting. I've been using it for some years now, and not found any problems with the data.

Good for you, and for him in being responsive. Your experience over years with the site means I will now certainly bookmark it as the best quick source of info, barring having to visit the individual stock sites and recalc'ing the figures from scratch.

TYVM.