Do any ASX lithium shares pay dividends?


Two of the market’s favourite talking points are dividends and lithium stocks, but do the pair ever converge into one ASX share?

Well, investors rejoice, there are a few stocks operating in the lithium segment that offer regular payouts.

Let’s take a look at why most lithium stocks don’t offer dividends and the few that do.

Why don’t more ASX lithium shares pay dividends?

Investors may have noticed that most ASX lithium shares don’t pay dividends. And there’s a good reason for that.

Dividends typically represent a portion of the company’s profits being paid back to shareholders. Unfortunately, most lithium companies listed on the Australian bouse haven’t yet turned a profit.

Major names like Core Lithium Ltd (ASX: CXO), Lake Resources N.L. (ASX: LKE), and Liontown Resources Limited (ASX: LTR) are still in exploration or development phases – a far cry from bringing in notable amounts of cash.

Of course, certain lithium stocks have previously paid dividends. Neometals Ltd (ASX: NMT), for example, has offered five special cash dividends in its history, with the latest handed out in early 2020.

On top of that, one broker tips Allkem Ltd (ASX: AKE) will offer its maiden dividend in financial year 2023, as my Fool colleague James reports.

But a middle ground between investing in lithium and snapping up dividend shares already exists on the ASX.

Some S&P/ASX 200 Index (ASX: XJO) companies are both regular dividend payers and involved with the battery-making material.

Mineral Resources Limited (ASX: MIN)

Mineral Resources might not be the first stock to come to mind when shopping for ASX lithium shares.

While most of the company’s business is in providing mining services, it also operates two hard rock lithium mines in the Pilbara region.

Mineral Resources currently offers a 3% dividend yield.

Rio Tinto Limited (ASX: RIO)

ASX 200 materials giant Rio Tinto is also involved with lithium.

It’s sourcing lithium from mining waste rock in California. The company is also battling to get its Jadar lithium project – located in Serbia – off the ground.

Rio Tinto shares are trading with a whopping 10.9% dividend yield right now.  

Wesfarmers Ltd (ASX: WES)

The final ASX lithium share offering dividends might come as a surprise. ASX 200 retail-focused conglomerate Wesfarmers does indeed have a finger in the lithium pie.

It made a final investment decision to develop the Mt Holland lithium project in 2021.

Wesfarmers’ dividend yield currently sits at 3.6%.

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