SAN's dividend rate of 8.3% will result in 100% gain in 8.7 years just from dividends. That's based on an unchanged stock price..
However, SAN's shares will undoubtedly appreciate as EU economies begin to recover. Most economists now agree that the world economies are slowly coming out of the recessions created by the financial markets' shock and the real-estate-prices collapse of the great recession. first the U.S economy recovered, then China, and now Japan as well as other Asian economies. The EU economies will undoubtedly follow because of the interdependence with other global economies.
And SAN's price should be expected to recover with the EU economies or even sooner because stock prices usually lead the economies.
In the U.S., bank stocks have been doing very well. After all, they can borrow from their depositors and from the FED almost at 0% interest while their average lending rates are higher than 3%. and that anomaly is expected to continue for several years. Meanwhile, the U.S. real estate market is showing signs of a solid recovery (as is evidend in the price of home-builders stocks). So when the EU real-estate markets begin to recover, and particularly Spain's housing market, SAN stock price will rise sharply.
It is all just a matter of time, perhaps a year or two. And meanwhile SAN's shareholders will gain from the IMPRESSIVE DIVIDENDS.
I'm long Satander, but the reality is that the pps is being supported by central banks only. Brazil and Europe's economy are still in the funk. I do think they recover later in the year and into 2014. Spain charges a 21% tax on the dividends, a good yield even after the tax. I keep it in my ROTH IRA.
eddie1969f is right. The current SAN's dividend is $0.78, which corresponds to a an annual rate of 11% (that's HUGE) for a stock price of $7.11.
So assuming an unchanged stock price, the gain for a shareholder will be 100% in just 6.7 years.
But given the dire economic state of the economies in spain and other EU countries, SAN's stock price should currently be considered suppressed. However, the state of the economies in the EU WILL INEVITABLY IMPROVE as a result of increasing recoveries in America and Asia (e.g., China, Japan, etc.).
U.S. bank stocks have already recovered nicely. So look for SAN to follow suit and lead EU bank stocks into recovery as the EU economies begin to stabilize.
Again, meanwhile, SAN's shareholders can enjoy SAN's impressive dividend payments.
They're paying a dividend of EUR 0.60 (US$ 0.78) or quarterly EUR 0.15 (US$ 0.20) in cash or shares (tax-free), that's a yield of 11.00% actually. http://www.google.com/finance?q=NYSE%3ASAN&ei=qq15UbDgLoSglgPP9QE