In 2025, Dax dividends soared above 52 billion euros.
In the financial landscape of the next couple years, corporations on the prestigious DAX list are projected to shell out a whopping 52.2 billion euros to their delighted shareholders by 2025. Despite a slight fall short of the 2024 record of 55.0 billion euros, these companies have managed to outperform expectations, even amidst heated debates over location. This Courageous Prediction comes from DekaBank, who've exhaustively scrutinized the dividend forecasts of the companies on both the DAX and MDAX lists.
The 50 courageous companies on the MDAX are forecasted to further amplify their payouts compared to 2024, up by around 7% to an impressive 6.9 billion euros. This brings the grand total for the 90 gallant companies on the DAX and MDAX to approximately 59 billion euros.
A heartening 23 out of the 40 companies on the DAX will reportedly raise their dividends per share compared to the previous year, with nine making matters go emissions-free, and a handful of eight showing a slight drop.
The payout ratio of these companies for 2025 is expected to tick up slightly, although it's still projected to remain well below the long-term average of 41%. "The dividend policy of the DAX companies is characterized by discipline and foresight," proclaims Joachim Schallmayer, the fearless leader of capital markets and strategy at DekaBank. "Locking arms with shareholders as they ride the waves of company success is still the right move and plays an important role in fostering a healthy shareholder culture."
Allianz shows no mercy
Historically, automobile manufacturers have been the big kahunas when it comes to dividends, but it's a whole new ball game now as insurers are making a powerful entrance onto center stage. "There's a shift happening within the DAX regarding dividend payouts and insurers are moving up the ranks" states Schallmayer. Interestingly enough, Mercedes was the top dog in 2024 when it came to payouts, but it's speculated that Allianz will claim the numero uno spot in 2025. Deka foresees Allianz doling out a staggering 5.9 billion euros, while the total dividends of the Big Three automakers - BMW, Volkswagen, and Mercedes-Benz – are estimated to amount to a 'mere' 9.9 billion euros, a decline of 4 billion euros from 2024 numbers.
Mercedes falls from grace
Allianz's dominance comes with a sizeable piece of the pie, accounting for a whopping 11% of the expected dividends of the DAX companies, bagging the top spot on the leaderboard. "The absolute increase in dividend sums expected in 2025 will be led by Deutsche Telekom, landing them in the second position" reports Deka's analysis. Siemens is expected to claim the coveted third spot, thanks to a significant boost in their own payouts by nearly 400 million euros, and the cuts made by the mighty automobile giants. According to the Deka research, Mercedes is forecasted to drop from the number one position to the teasing fourth place, Volkswagen will go from a promising third to a humbling fifth, and BMW will slide from a respectable fifth to a somewhat disappointing seventh.
The big payers remain big
As in past times, by 2025, a good portion of the grand dividend pie will once again be sliced by a select few. "The seven Magnificent DAX dividend payers will band together to distribute more than half of the total dividend sum" says Schallmayer. If the 90 DAX and MDAX companies are divided by sectors, the manufacturers of cyclical consumer goods, which includes vehicles, claim 23% of the distributions, followed closely by industries and finance, each with 21%.
Bavaria reigns supreme
Companies headquartered in Bavaria are expected to hand out a total of around 18.5 billion euros to their enamored shareholders. "Bavaria makes another strong showing on the distribution front, proving itself to be the most generous region in Germany" says Schallmayer. North Rhine-Westphalia follows closely with 13.5 billion euros, and Baden-Württemberg is knocking on the door with nearly 12 billion euros.
"Dividend is a reliable stream of income"
According to Deka, DAX companies are currently cruising along with a dividend yield of 3% at current prices. Although strategist Schallmayer predicts some turbulent waters ahead due to the various challenges on the horizon, he feels there's a possibility of a moderate increase in corporate profits and share prices. "Especially in such stressful situations, the dividend is a dependable source of income" he says. Taking a look at the development of the price index (excluding dividends) and the performance index (including dividends) of the DAX, the capital market expert recommends investors to invest their received dividends back into the market. "In the grand scheme of equity investment returns, it's the dividend and its reinvestment that play a critical role."
- Insurer Allianz is projected to outperform automobile manufacturers in dividends, potentially claiming the highest dividend sum among DAX companies in 2025 with a predicted payout of 5.9 billion euros.
- Mercedes, previously the top dog in dividend payouts, is forecasted to drop from the number one position to the fourth place in 2025, while Allianz bags the top spot on the leaderboard with a significant share of 11% of the expected dividends of the DAX companies.
- The seven largest dividend payers in the DAX are projected to distribute more than half of the total dividend sum, with manufacturers of cyclical consumer goods (including vehicles) claiming 23% of the distributions, followed closely by industries and finance, each with 21%.
- Companies headquartered in Bavaria are expected to be the most generous, handing out a total of around 18.5 billion euros to their shareholders, making it the most generous region in Germany.
