Shares of Nine Entertainment Co. Holdings Ltd (ASX: NEC) experienced a significant downturn today, plummeting 35.88% to A$1.09, primarily driven by the stock trading ex-dividend. The media company’s shares saw a sharp decline as markets reacted to the absence of the dividend entitlement.
The catalyst for the decline is Nine Entertainment’s ex-dividend date of September 11, 2025. The company declared a final dividend of 4 cents per share and a special dividend of 49 cents per share, both fully franked, payable on September 26th. The special dividend was made possible due to the divestment of its stake in Domain, which generated $1.4 billion in cash proceeds. In FY25, Domain contributed $413.3 million in revenue and $146 million to Nine Entertainment’s group EBITDA.
The dividend news initially boosted the stock, reaching a new 52-week high of $1.90 upon announcement. However, Nine Entertainment’s FY25 results revealed a mixed performance. While revenue increased by 2% to $2.68 billion, operating EBITDA fell by 6% to $486.1 million, and net profit after tax declined by 10% to $194.4 million. Fully diluted earnings per share also decreased by 10% to 10.5 cents.
Macquarie Group maintains a neutral stance on Nine Entertainment, setting a price target of $1.25. The broker also reduced its earnings per share forecasts for the coming years, citing challenges in the broadcast and publishing sectors.
Today’s share price movement underscores the immediate impact of dividend distributions on stock valuations. While the special dividend provided a short-term boost, the underlying financial performance and analyst concerns suggest potential headwinds for Nine Entertainment moving forward.
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