| Graphing Dividends 2023 |
| 02/08/23 Norman Rothery Stingy Investing Dividends |
Here's an update to my Graphing Dividends feature that corrects calculation errors that impacted the 2022 returns. My apologies for missing the bug the first time around. [pdf]
|
| Dividend impact on stock returns |
| 02/05/23 Dividends |
"As shown in the table above, without controlling for the factor exposures, while the dividend payers had lower monthly returns (1.06% vs. 1.09%), the significantly higher monthly volatility of the non-payers (6.42% vs. 4.23%) resulted in the dividend payers having a higher annualized compound return (12.25% vs. 11.10%)."
|
| Be wary of extreme yields |
| 01/29/23 Norman Rothery Stingy Investing Dividends |
"Overall, returns tend to fall dramatically when yields reach extremely high levels."
|
| The smaller stable dividend portfolio |
| 01/17/23 Norman Rothery Stingy Investing Dividends |
"I used a combined injection of low-volatility and dividends on large stocks to form the Stable Dividend portfolio. This time around I'm using a similar approach to inoculate smaller stocks to form the, imaginatively named, Smaller Stable Dividend portfolio."
|
| Dividends and buybacks |
| 01/01/23 Dividends |
"the combined yield from both is close to 5%"
|
| The Dividend Monster portfolio |
| 10/31/22 Momentum Investing Norman Rothery Stingy Investing Dividends |
"I was working in the lab late one night, when I brewed up the frightfully profitable Dividend Monster portfolio, which mixes momentum with dividend investing."
|
| The Frugal Dividend portfolio |
| 10/23/22 Value Investing Norman Rothery Stingy Investing Dividends |
"The Frugal Dividend portfolio offers a crop of stable dividend payers trading at bargain prices. It's the value investing variant of the Stable Dividend portfolio"
|
| The Stable Dividend portfolio |
| 10/11/22 Value Investing Norman Rothery Stingy Investing Dividends |
"The recent tumble inspired me to check in on the Stable Dividend strategy to see how it's holding up in these uncertain times. It offers a conservative approach to picking stocks that focuses on Canadian dividend payers that are steady performers."
|
| Dividend growers to manage volatility |
| 08/07/22 Dividends |
"Notice that performance of the dividend growers nearly matches the return of the Russell 1000 Index. However, volatility is 2.4% per year lower. Said another way, the ride to achieve a similar return has fewer twists and turns."
|
| Graphing Dividends 2022 |
| 02/25/22 Norman Rothery Stingy Investing Dividends |
"I've written many articles highlighting the big returns generated by Canadian dividend stocks. They usually include only one or two graphs due to space limitations. But I've given the extra graphs a home here for the enjoyment of dividend aficionados." [pdf]
|
| Dividend charts |
| 01/16/22 Indexing Dividends |
"When you look at the long-term cash dividends on the S&P 500 going back to the inception of the index in 1957, inflation has averaged 3.6% but cash dividends have provided real growth on top of inflation."
|
| Graphing Dividends |
| 03/07/21 Norman Rothery Stingy Investing Dividends |
"I've written many articles highlighting the big returns generated by Canadian dividend stocks. They usually include only one or two graphs due to space limitations. But I've given the extra graphs a home here for the enjoyment of dividend aficionados." [pdf]
|
| Where things stand in Canadian dividend land |
| 02/28/21 Norman Rothery Stingy Investing Dividends |
"The long-term results dramatically favour the high-yield portfolio, which climbed by an average of 13.5 per cent from the start of 1977 through to the end of 2020. The market portfolio gained an average of 10.1 per cent annually over the same period while the low-yield portfolio fared nearly as well with a 9.8-per-cent annual gain." [$]
|
| Dividends power the wealth effect |
| 01/10/21 Taxes Dividends |
"if politicians sought to exploit the wealth effect the data would suggest that they encourage firms to increase their dividend distributions as much as possible."
|
| A sleepy approach to dividend investing |
| 09/26/20 Stingy Investing Dividends |
"Many speculators trade frequently, but investors should focus on the long term rather than on the short term. Smart investors like to buy and hold for very long periods while their firms grow and pay dividends." [$]
|
| A good source of income |
| 05/23/20 Dividends |
"Stocks may be one of the best sources of income of any asset class. And that income may be more important than ever with bond yields on the floor."
|
| Dividends and inflation |
| 04/24/20 Dividends |
"Relative to market prices and earnings, dividends have been the least volatile and exhibited the strongest correlations with inflation"
|
| Dividend investing under the microscope |
| 12/11/19 Stingy Investing Dividends |
"Today I'm going to put Canadian dividend stocks under the microscope to see how they measured up in past bullish and bearish periods." [$]
|
| Graphing Dividends |
| 12/11/19 Stingy Investing Dividends |
"I've written many articles highlighting the big returns generated by Canadian dividend stocks. They usually include only one or two graphs due to space limitations. But I've given the extra graphs a home here for the enjoyment of dividend aficionados." [pdf]
|
| Dividend downturns |
| 11/22/19 Hallett Dividends |
"There is a lot to like about dividend-paying stocks. Dividends generally follow earnings, and are cold hard evidence of earnings. existence. In Canada, this infatuation with dividend-payers is compounded by our love of bank and utility stocks, and favourable tax treatment of dividends paid by Canadian companies. Many Canadians view dividend-paying stocks as an investment cure-all - e.g., replacements for low-yielding bonds, and protection from a bear market or rising interest rates. And while they can sometimes deliver, history shows that the expected protection is far from certain."
|
| Consuming dividends |
| 11/08/19 Academia Dividends |
"This paper studies why investors buy dividend-paying assets and how they time their consumption accordingly to anticipated income. We combine administrative bank data linking customers' categorized consumption transactions and income to detailed portfolio and trading data and survey responses on financial behavior. We find that private consumption is excessively sensitive to dividend income. Investors across wealth, income and age distributions increase spending precisely around dividend receipt. Importantly, we find that consumption responses are driven by financially sophisticated investors who select dividend portfolios, anticipate dividend income, and plan consumption accordingly. Our results contribute to the literature on a dividend clientele and provide evidence of 'planned' excess sensitivity."
|
| Cash back |
| 11/03/19 Dividends |
"We look around us and imagine that today's largest corporations will always be with us, but that simply isn't the case. That brings me to my second key point: We should want companies to return cash to shareholders - and preferably lots of it."
|
| Dividends can lie |
| 10/22/19 Dividends |
"Don't get me wrong, I love dividends. I even have a money management strategy based off of them. But I know that dividends are more fickle than most of their fans admit. The infatuation that some money managers have with dividends is misplaced. To say that 'Dividends don't lie,' is an overstatement. Yes, the check will clear, and you get money, but that does not mean that the next dividend will get paid."
|
| The perch portfolio |
| 08/31/19 Value Investing Stingy Investing Dividends |
"When it comes to lunch, many investors pay for their lakeside repast using money sent their way in the form of dividends from large companies. But smaller companies also pay dividends and often generate succulent returns." [$]
|
| The Frugal Dividend portfolio |
| 06/26/19 Value Investing Norman Rothery Stingy Investing Dividends |
"Mixing a gin and tonic yields a satisfying summer drink. Combining investment ingredients can provide sunny returns. In that spirit, I'd like to introduce the Frugal Dividend portfolio. It adds a value investing twist to the Stable Dividend portfolio. The idea is to seek out low-volatility dividend stocks that trade at reasonable prices because the combination has worked well over the past 25 years." [$]
|
| Dividends plus low vol |
| 05/20/19 Norman Rothery Stingy Investing Dividends |
"the Stable Dividend portfolio, goes a step further. It starts with the dividend payers from the 300 stock portfolio and buys an equal amount of the 20 stocks with the lowest volatility (over the prior 260 days) each year. It fared even better with an average annual return of 13.7 per cent over the 25 year period." [$]
|
| Dividends fade |
| 04/12/19 Dividends |
"In the past, dividends were the only reason investors placed their money in equities. Now, dividends play a much smaller role, for better or worse, in the overall stock market."
|
| High-yield small-caps |
| 10/09/18 Norman Rothery Stingy Investing Dividends |
"the middle portfolio of medium-yielding (quintile) stocks grew at a compound annual rate of 14.1 per cent and outperformed the S&P/TSX Composite Index by an average of 6.6 percentage points per year." (Avoid the top and bottom yield quintiles.) [$]
|
| Picking dividend growers |
| 09/10/18 Norman Rothery Stingy Investing Dividends |
Wherein I observe that dividend investors should avoid the intersection of high yield and high dividend growth. [$]
|
| Dividend yield vs dividend growth |
| 09/10/18 Dividends |
"Our research confirms that investors should focus on dividend yield rather than dividend growth rates."
|
| Beating the TSX |
| 08/22/18 Norman Rothery Stingy Investing Dividends |
Wherein I observe that dividend payers in the TSX beat the market by an average of 2.7 percentage points annually from 2001 to 2017 while non-payers trailed the market by 5.0 percentage points annually. But avoid the 5% of stocks with the highest yields that trailed the market by an average of 7.0 percentage points annually. [$]
|
| The monster portfolio |
| 10/30/17 Momentum Investing Norman Rothery Stingy Investing Dividends |
"But if investing in solid stocks bores you to tears and you're willing to take on more risk for the slim possibility of gigantic rewards then I might have the just thing for you." [$]
|
| Avoid dividends |
| 10/30/17 Value Investing Dividends |
"Many investors, including retirees, value those quarterly dividend checks. But recognize the huge opportunity cost ones pays for them. The 'bird in the hand,' so to speak, is costing about three or four in the bush."
|
| Top dividend stocks |
| 09/25/17 Norman Rothery Stingy Investing Dividends |
"We're pleased to present you with the eleventh edition of the MoneySense Dividend All-Stars. It serves up a new crop of the best blue-chip dividend stocks in Canada while harvesting a decade's worth of gains."
|
| ILTB with Meb Faber |
| 09/11/17 Value Investing Markets Dividends |
"Meb is a quantitative researcher whose firm Cambria has been behind many interesting investment strategies that break the Wall Street mold. We talk investing factors, dividends, angel investing, podcasts and more." [audio]
|
| Chasing dividend growth |
| 05/21/17 Norman Rothery Stingy Investing Dividends |
"Income-oriented investors love stocks that have a habit of growing their dividends. I confess to being one of them because I've done extraordinarily well by buying such stocks when the market gets a little panicky." [$]
|
| The dividend growth myth |
| 04/30/17 Dividends |
"Now, with its updated return calculations, Ned Davis shows dividend growers returning 12.89%, all dividend stocks 12.83%, and equal weight S&P 500 12.35%! (All beginning in 1973.) So, an entire generation of funds was sold on the premise of dividend growth outperformance. The problem is it's misleading because it doesn't tell the whole story."
|
| Dividend policy |
| 02/12/17 Dividends |
"The shift is remarkable. In 1988, almost 70% of all cash returned to stockholders took the form of dividends and by 2016, close to 60% of all cash returned took the form of buybacks."
|
| Is dividend investing dangerous? |
| 12/11/16 Dividends |
"Even a fairly vanilla investment strategy, like dividend investing, is not without its critics. There is a significant amount of evidence that dividend strategies - including focusing on dividend payers, dividend growers, or high yielding stocks - have historically generated excess return."
|
| Retirement 100: Fall 2015 |
| 05/27/16 Norman Rothery Stingy Investing Dividends |
"We're pleased to say that our efforts have been highly rewarding since we started way back in 2007. Our A-graded stocks have gained 117% on average since then, including dividends reinvested annually. Similarly, the A- and B-graded stocks have climbed 67%. By way of comparison, the S&P/TSX Composite Index ETF (XIC), which tracks the broad Canadian stock market, logged a return of 25% over the same period and the dividend-oriented iShares Canadian Select Dividend ETF (XDV) advanced 35%."
|
| The cost of dividends |
| 05/08/16 Value Investing Dividends |
"It turns out that the simple value strategy (which included avoiding high yield stocks) actually produced higher returns than the dividend strategy - not just similar returns. In other words, before we even get to the tax benefits, 'value' had already trumped 'dividends.'"
|
| Dividend stock downside |
| 03/20/16 Value Investing Taxes Dividends |
"I had started with a hypothesis: by avoiding dividends might we actually improve 'dividend investing'? But by removing the dividend, it inadvertently refocused the selection methodology on pure value. My research turned out to be a backdoor way of reminding myself that value investing and dividend investing - while often confused as the same thing - are actually distinct strategies. And more times than not, value wins out."
|
| How to beat the S&P 500 index |
| 03/19/16 Indexing Dividends |
"From 1991 until 2016, his strategy gained an average compound return of 12.76 percent per year. In a tax deferred account (not including transaction costs) it would have turned $10,000 into $201,315. Investors in Vanguard.s S&P 500 Index (VFINX) would have averaged a compound annual return of 9.7 percent per year. The same $10,000 would have grown to $101,265."
|
| Reassurance for dividend investors |
| 11/15/15 Norman Rothery Stingy Investing Dividends |
"The spectre of rising interest rates hangs like a miasma over the Canadian economy. They're currently being warded off by an accommodative monetary policy from the Bank of Canada. But it is only a matter of time before inflation picks up and rates start to climb. If they shoot up too fast, the real estate bubble might pop and take down a large part of the financial system with it. It's a thought that's causing some dividend investors to toss and turn at night." [$]
|
| It's time to reap the season's dividend treats |
| 10/30/15 Norman Rothery Stingy Investing Dividends |
"The high-yield group outperformed the market by an average of 2.2 percentage points annually, which represents a considerable bonus for a very simple strategy. On the other hand, the no-dividend group suffered mightily and lagged the market by an average of 7.3 percentage points annually. As a result, investors should think twice before buying stocks that don't pay dividends."
|
| Charlie Dreifus interview |
| 09/25/15 Value Investing Dividends |
"veteran contrarian investor Charlie Dreifus explains why he is not worried about recent stock market turbulence and where he is still finding high quality bargains."
|
| Dividend yield a value factor? |
| 07/31/15 Value Investing Dividends |
"Prior to the financial crisis bottom (pre-2009), the higher yielders were cheaper than the next bucket (2-4% yield) 92% of the time. Since 2009, they've only been cheaper 30% of the time."
|
| High conviction buybacks |
| 07/18/15 Value Investing Dividends |
"the high conviction companies have gone on to ourperform the average large stock by about 3.3% in the subsequent year, while the low conviction firms haven't really delivered much excess return at all (just 0.5%, on average)."
|
| Dividend stocks and value investing |
| 06/20/15 Value Investing Dividends |
"The results suggest that a sort on a simple value investing measure works well at sorting dividend stocks."
|
| Retirement 100: Fall 2014 |
| 05/04/15 Stingy Investing Dividends |
"We're happy to report that our efforts have paid off handsomely so far. If you had rolled your portfolio into our new batch of A-graded stocks every year since our launch in 2007, you would have enjoyed a total gain of 142%. You'd be up a total of 91% if you had followed stocks with either A or B grades. That's pretty good, considering that the market suffered from a huge crash during that period. By way of comparison, the S&P/TSX Composite Index ETF (XIC), which tracks the broad Canadian stock market, logged a total return of just 38% over the same period. We also beat the dividend-oriented iShares Canadian Select Dividend ETF (XDV), which climbed by 58%."
|
| Dogs of The Footsie |
| 01/18/15 Dividends |
"The dogs are also well ahead over the past 13 years, growing by an average annual 16.3 per cent in total return terms, two-and-a-half times the 6.5 per cent total return figure for the index."
|
| The power of share repurchases |
| 06/29/14 Markets Value Investing Dividends |
"One of the most effective stock selection strategies in the U.S. over the past several decades has been to buy stocks that are in the midst of repurchasing significant quantities of their shares-but just blindly following buybacks isn't always the best strategy. While many companies that are repurchasing large quantities of their shares make for great investments, others are dangerous and should be avoided."
|
| Disbursing cash to shareholders |
| 05/18/14 Dividends |
"Frequently asked questions about buybacks and dividends"
|
| Enhancing yield-based strategies |
| 05/18/14 Academia Dividends |
"High dividend yield stocks do not reliably earn above-average risk-adjusted returns. More complete measures of shareholder yield, which account for net share repurchases, perform better. We explore the use of net-debt paydown as a way to further enhance shareholder yield. The addition of net-debt paydown enhances risk-adjusted returns and creates a shareholder yield metric that is more robust over time. We also explore the technique of separating yield metrics by payout percentage as a way to enhance return predictability. We find some evidence that using payout percentage within a yield category can systematically improve portfolio performance."
|
| Finding value among U.S. dividend stocks |
| 10/13/13 Value Investing Stingy Investing Dividends |
"To obtain a well-rounded portfolio, dividend investors should pick up at least a few international stocks. That's why I'm on the hunt today for U.S. dividend payers that might also appeal to value investors."
|
| A recipe for a better dividend portfolio |
| 09/29/13 Stingy Investing Dividends |
"As the weather gets colder and I get older, I've begun to enjoy the comfort provided by a warm bowl of soup. There's nothing like a delicious mix of vegetables and chicken to ward off the chill in the air. As I sat down to my first bowl of the season my thoughts turned to how I might pay for my humble repast for years to come. A few good dividend stocks might do the trick."
|
| Fishing for a bargain among small-fry |
| 09/22/13 Value Investing Stingy Investing Dividends |
"Insisting on value helps to keep the prices I pay in line, while keeping an eye on dividend growth points the way to reasonably healthy businesses."
|
| Consuelo interviews Jason Zweig |
| 08/04/13 Indexing Zweig Dividends |
"'There's no doubt that the pursuit of yield is bordering on a mania' says Jason Zweig, The Wall Street Journal's Personal Finance Columnist. Don't miss Consuelo's discussion when she asks Zweig about dangerous investor behavior and why he is concerned as investors are abandoning bonds and flocking to dividend-paying stocks."
|
| This fund is likely to chop its payout |
| 06/01/13 Funds Hallett Dividends |
"I continue to be amazed by some of these products that pay out fat monthly cash amounts. I know of this fund but have not followed it closely. When I first looked it up in response to Derek's note, the sub-$4 unit price prompted me to double check to make sure I had the right fund. But such is the (negative) power of overdistributing - particularly in a volatile fund. IA Clarington Canadian Dividend is entirely invested in stocks (unlike the many others I have reviewed and analyzed, which were balanced funds with stocks and bonds)."
|
| The high dividend yield return advantage |
| 04/20/13 Dividends |
"In the pages that follow, we set forth a number of studies, largely from academia, analyzing the importance of dividends, and the association of high dividend yields with attractive investment returns over long measurement periods. You may be familiar with our prior booklet, What Has Worked In Investing, where we provided an anthology of studies which empirically identified a return advantage for value-oriented investment characteristics. In the same spirit, we attempt to examine what some in our industry have referred to as the "yield effect"; i.e., the correlation of high dividend yields to attractive rates of return over long measurement periods. Much has been written about dividends, and what is contained herein is not meant to be an exhaustive analysis, but rather a sampling of studies examining the impact of dividends on investment returns. We hope it will provide you with added insight and confidence, as it did us, in pursuing a yield-oriented investment strategy."
|
| A value tilt in disguise? |
| 04/20/13 Value Investing Dividends |
"The yield factor associated with high-dividend-yielding stocks actually detracted from performance."
|
| Retirement 100 (Fall 2012) |
| 02/16/13 Value Investing Stingy Investing Dividends |
"Like avid gardeners, conservative investors want their stock dividends to grow. They aren't in it for a quick trade and, instead, follow a slower steadier method that requires only a little weeding and pruning from time to time. It's an approach that has allowed more than a few investors to enjoy a comfortable retirement."
|
| You do the math |
| 10/13/12 Taxes Dividends |
"One of the nice things about dividends is that they're taxed at a lower rate than interest or other income. Most people know that. What they may not know is that, depending on the province, it's possible for an individual with no other sources of income to earn nearly $50,000 in dividends without paying any tax at all."
|
| Value and dividends |
| 10/06/12 Value Investing Stingy Investing Dividends |
"Combining a search for dividends with a nose for value often produces good results. But let's take a look at a few practical issues you might encounter when looking for stocks with this tempting combination of features."
|
| Dividend stocks for bargain hunters |
| 05/26/12 Stingy Investing Dividends |
"Fortunately, there is good news even during a rough patch like this. Lower prices can be an opportunity for bargain hunters. In fact, a bear market can be an excellent time to track down a few juicy dividend stocks while they're on sale."
|
| Dissecting shareholder yield |
| 05/23/12 Dividends |
"We study a variety of previously examined payout yields over time: dividends, share repurchases cash flow, and equity issuance. We confirm on a newer dataset what other research has found dividend yield no longer works, but more complete measures of shareholder yield hold promise. We contribute to the literature by examining an additional variable to payout yield, net debt pay down. The addition of net debt pay down helps performance, but is not a panacea. We find that regardless of the yield metric chosen, the predictive power of separating stocks into high and low yield portfolios has lost considerable power in the last twenty years. We also explore the concept of separating yield metrics by payout percentage as a way to salvage the predictability of yield metrics. We find no evidence that using payout percentage within a yield category can systematically improve portfolio performance."
|
| Dividend stocks aren't fail-safe |
| 04/21/12 Stingy Investing Dividends |
"Dividend investing has many sterling qualities but protection against downturns is not one of them. With few exceptions, dividend stocks fall just as hard as other stocks when the market crashes."
|
| The dividend-fund dilemma |
| 04/08/12 Dividends |
"Sooner or later, the markets always punish investors who do the right thing for the wrong reason. Some investors in dividend-oriented stock funds might end up learning that lesson the hard way."
|
| Dogs bite back |
| 11/26/11 Dividends |
"The Dogs of the Dow are running strong this year. The decades-old strategy, which calls for buying the 10 highest-yielding shares among the 30 Dow Jones Industrial Average members at the end of each year, has returned 5.5% this year through Wednesday, versus a 0.4% decline for the broader Dow."
|
| Dividends: collect, reinvest, repeat |
| 09/14/11 Dividends |
"The market storm of the past few months has produced a bright side: dividend yields are on the rise."
|
| Dividend growth stars |
| 06/25/11 Dividends |
"Using data going back to 1992, CPMS created annual portfolios of all TSX-listed stocks that increased their dividend over the previous year. The annualized return through 2010 was 13.9 per cent, compared to 9.7 per cent for the S&P/TSX composite total return index."
|
| Unlocking cash hoards |
| 05/28/11 Dividends |
"There is a cash crisis in corporate America - although it comes not from a shortage of the stuff, but from a surplus."
|
| Curb your enthusiasm |
| 03/26/11 Dividends |
"If you want to drive today's investors mad with desire, try this magic word: dividends. There's something about the promise of a high yield that makes grey-haired stock buyers turn giddy as 17-year-olds. It's not entirely clear what gives rise to this intoxicating effect. Stock market historians say dividend-paying stocks have generally done better than their non-dividend-paying peers, perhaps because being forced to disgorge cash on a regular basis pushes executives to focus on their core business rather than lavishing money on the CEO's pet projects. But paying a dividend, by itself, doesn't guarantee a company success."
|
| Your Roadmap to Investment Success |
| 02/07/11 Funds Value Investing Stingy Investing Dividends |
"I was pleased to talk at The Investment Show where I made the case that novice investors should opt for low-fee balanced funds. I then moved on to more advanced topics including dividend investing and value investing. Here are the slides that were used..."
|
| Dogs could have their day in 2011 |
| 12/29/10 Dividends |
"Michael O'Higgins is the first to admit that the Dogs of the Dow strategy has fallen on hard times as a stock-picking technique. "I'd say it's very unpopular right now," he said. "In the investment world, if something hasn't worked for a year or two, they damn it.""
|
| Roads to Investment Success |
| 12/05/10 Funds Value Investing Stingy Investing Dividends |
"I was pleased to talk to the University of Toronto Faculty Association where I made the case that novice investors should opt for low-fee balanced funds. I then discussed more advanced topics in dividends and value investing. Although the session was not recorded, here are the slides that were used..."
|
| A man from a different time |
| 08/25/10 Montier Dividends |
"Looking at the U.S. market since 1871, on a 1-year time horizon, nearly 80% of the return has been generated by fluctuations in valuation. However, as the time horizon is extended, 'fundamentals' play an increasing role in return generation. For example, at a 5-year time horizon, dividend yield and dividend growth account for almost 80% of the return."
|
| Dividend investing |
| 06/21/10 Stingy Investing Dividends |
"By sticking to companies that have the means to pay high dividend yields, you not only get the added bonus of a regular paycheque from your portfolio (now electronically deposited in your investing account), but studies show that you'll likely enjoy a higher rate of return over the long run than the market typically provides."
|
| Dividend growers |
| 06/21/10 Stingy Investing Dividends |
"Only a handful of stocks in the S&P/TSX 60 sport good five-year dividend growth records. Even fewer pay dividends that are well supported by earnings. I'll highlight four that pass both tests, and also happen to trade at modest price-to-earnings ratios."
|
| Dividends reign as market pours |
| 06/13/10 Dividends |
"But layered against the dourness, earnings have been strong, cash positions are growing and interest rates are extremely low, making other investments look relatively more attractive than bonds and cash."
|
| Value investing flip books |
| 05/16/10 Value Investing Stingy Investing Dividends |
"The flip book helps to highlight a core problem for investors. Namely, the urge to swap out of a good strategy during periods of underperformance which happen frequently and can last for several years. So, be warned. Oh, and also have a little fun with the flip books."
|
| They're clipping your dividends |
| 04/15/10 Taxes Dividends |
"Come next January the favorable 15% rate on dividends will expire, making them subject to taxation as "ordinary income." At the same time the maximum rate is kicking up from 35% to 39.6%. The third thing that will happen in 2011 is the resurrection of a rule that ostensibly limits deductions but for the majority of taxpayers is nothing but a boost in their tax bracket. This rule adds 1.2 percentage points to your rate. In 2013 comes a fourth tax increase: a 3.8% surtax on investment income. Add it up. Dividends that used to be taxed at 15% are set to be taxed at 44.6%."
|
| You should get a bigger slice of earnings |
| 03/14/10 Dividends |
"No investor can be certain that a company will be able to keep creating value in the future. Often, however, you can be sure that a company can safely distribute value in the present. It is high time for companies to cut shareholders a bigger slice of the pie."
|
| Loosen up, tightwads! |
| 02/01/10 Dividends |
"Many big companies with the financial wherewithal to pay dividends are being stingy about payouts -- for no good reason. By hoarding cash, the likes of Apple, Google, Cisco, Amazon, eBay, IBM and Amgen are doing their shareholders a disservice -- and it's time for that to change."
|
| Dividend growth lives |
| 12/16/09 Dividends |
"Still need convincing that dividend growth stocks, and utilities in particular, deserve a place in a well-diversified portfolio? In his December investment outlook, Pacific Investment Management Co.'s Bill Gross - manager of the world's biggest bond fund - urged investors to move money out of ultra-low-yielding savings accounts and money market funds and into utilities stocks. Utilities are reasonably priced, and "their growth in earnings should mimic the U.S. economy as they always have, and most importantly, they yield 5 to 6 per cent, not .01 per cent," he wrote."
|
| Select dividend club |
| 12/14/09 Indexing Dividends |
"Canada's most exclusive dividend club just got a whole lot smaller. After a year in which some high-profile companies slashed their dividends and many others failed to increase their payments as they dug in for the recession, the S&P/TSX Canadian Dividend Aristocrats index is losing 15 members - including most of the banks - and gaining just one."
|
| Dividend appeal |
| 10/26/09 Dorfman Dividends |
"Dividends are as old-fashioned as corsets, if you listen to most investors. How wrong they are."
|
| The case for global dividends |
| 09/28/09 Dividends |
"If you're a Canadian investor who believes in dividends, the fact that Canada makes up but 4% of the world's stock markets should lead you to a logical conclusion: that global dividends should make up a good chunk of your total portfolio."
|
| Dividends and the frozen OJ syndrome |
| 09/07/09 Dividends |
"In light of the powerful historical evidence that companies can grow and still pay out somewhere around half their earnings as dividends, why is the demand for dividends today so small? If the theoretical case for high payout ratios is beyond dispute, why is the demand for dividends so small? In the wake of corporate and accounting scandals that one might expect to lift the demand for dividends, why is the demand for dividends so small? In view of the radical change in the taxation of dividends, why is the demand for dividends so small? As the King of Siam put it, 'It is a puzzlement.'"
|
| Even when down, bet on the best |
| 06/22/09 Stingy Investing Dividends |
"As the illustration shows, four of the current 10 "dogs" have yields above 6%: Merck & Co. Inc., Verizon Communications, AT&T Inc. and E I Du Pont de Nemours and Co. Even after massive cuts to their dividends, Pfizer Inc. still yields 4.38% and General Electric Co. 3.24%. Based on current data, Norman Rothery, founder of StingyInvestor.com,would eliminate Alcoa Inc., Bank of America Corp, G. E. and JP Morgan Chase and Co. from the list. They would be replaced with Caterpillar Inc., Chevron, Home Depot Inc. and J&J, after which Rothery's updated list of 10 dogs would sport an average yield of 4.9%. Berkshire Hathaway owns G. E. and Kraft Foods Inc., while Pfizer and Home Depot Inc. are favourites of other prominent value investors. However, Rothery prefers to look farther afield than the Dow."
|
| Income 100: Summer 2009 |
| 05/26/09 Value Investing Stingy Investing Dividends |
"The good news is the top income stocks - those rated A - outperformed the Canadian Dividend ETF by 7.1 percentage points and they bested the S&P/TSX Composite ETF by a whopping 15.6 percentage points."
|
| There's hope in those dividends |
| 05/03/09 Dividends |
"Companies that have managed to increase their payouts in this tough economic climate may be a good target for a time-tested conservative investment strategy: buying shares of solid dividend-payers."
|
| S&P 'dividend aristocrats' dwindle |
| 04/02/09 Dividends |
"The aristocracy is under siege. Standard & Poor's annual list of companies that increased payouts for at least 25 years is in danger of falling below 40 for the first time since 1992 after slumping profits forced executives to conserve cash."
|
| High yield, low payout |
| 03/29/09 Dividends |
"How has the plain dividend yield strategy worked over the years? Stocks with high yields generally outperform those with low yields. The highest-dividend-yielding stocks were not overall leaders. Stocks ranking in decile eight had the best performance."
|
| Canadian dividend yield strategy |
| 03/29/09 Dividends |
"What is the optimal combination of dividend yield and payout ratio for investors? We extend our coverage to the Canadian market in this report, expanding on our prior research, which examined the influences of dividend yield and payout ratios within the U.S. market. Consistent with our previous work, we find that companies with a high dividend yield and a low payout ratio had the best performance when applying our backtest methodology to large-cap Canadian companies since 1990."
|
| S&P 500 Dividend Aristocrats |
| 03/18/09 Dividends |
"Since 1926, dividends have contributed to approximately one-third of total return while capital appreciations have contributed two-thirds. Therefore, both sustainable dividend income and capital appreciation potential are important to total return expectations. Managers use stable and increasing dividends as a sign of confidence in their firm's prospects, while investors consider such track records as a sign of corporate maturity and strength. The S&P 500 Dividend Aristocrats Index measures the performance of the S&P 500 index constituents that have followed a policy of consistently increasing dividends every year for at least 25 consecutive years. The S&P 500 Dividend Aristocrats Class of 2009 includes 52 securities diversified across 10 sectors. The constituents have both growth and value characteristics. The composition of the S&P 500 Dividend Aristocrats contrasts with that of typical dividend oriented lists and benchmarks that have high exposure to Financials and Utilities sectors and have a steep value bias."
|
| Delving into Dividends |
| 03/13/09 Tipsheet Dividends |
"It might surprise you, but dividends are the primary source of long-term returns for stock investors. From 1900 to 2008 U.S. stocks provided average annual real returns of 6.0% including reinvested dividends. However, without the dividends, U.S. stocks only gained 1.7% a year over the same period. That's why I decided to take a close look at the history of U.S. dividends with the help of Robert Shiller's data."
|
| Slash and burn |
| 03/07/09 Dividends |
"For many firms dividend cuts are an unpleasant task that should not be shirked. There is no point in starving a business and endangering a firm.s balance-sheet in order to meet macho dividend commitments. The counter-argument, that cuts remove an important discipline on managers, hardly holds true today, when all firms are counting the pennies. That being so, when firms announced cuts why did their share prices slump? The reason has a lot to do with signalling."
|
| Dividends falling |
| 02/23/09 Dividends |
"The fastest reduction in U.S. dividends since 1955 is depriving investors of the only thing that gave stocks an advantage over government bonds in the last century. U.S. equities returned 6 percent a year on average since 1900, inflation-adjusted data compiled by the London Business School and Credit Suisse Group AG show. Take away dividends and the annual gain drops to 1.7 percent, compared with 2.1 percent for long-term Treasury bonds, according to the data."
|
| Dividend and conquer |
| 02/19/09 Indexing Dividends |
"Dividends are delectable again. This is to say, the bear market is renewing investors' appreciation of the contribution that dividends make to the returns of their stock portfolios -- as opposed to capital gains."
|
| 20 dividend plays for 2009 |
| 02/17/09 Dividends |
"This year likely will see the largest annual decline since 1942 in dividends paid by the companies in the Standard & Poor's 500 index. S&P projects dividends will fall by 13% in 2009, and the numbers could get worse. "We're taking an optimistic view," says Howard Silverblatt, the senior index analyst at S&P. "If corporations don't see better business conditions later this year, dividend cuts could become more widespread.""
|
| Markets in 19th century Britain |
| 02/16/09 Academia Value Investing Dividends |
"This article examines the size and value anomalies using an original dataset consisting of monthly information on stock prices and annual information on dividends for 1,051 stocks traded in the London Stock Exchange between 1825 and 1870. In this historical British stock market, smaller stocks are found to deliver significantly higher returns than the larger ones. Value stocks indicated by high dividend yield also have higher average returns than growth stocks. The empirical evidence from this article provides important and fresh new empirical evidence on the asset pricing anomalies, suggesting that the size and value anomalies are unlikely to be random events that just appeared by chance."
|
| Dividend ETFs offer mild defense |
| 02/12/09 Indexing Dividends |
"High-dividend stocks proved only mildly defensive during the first phase of the debt crisis, and it is instructive to consider the reasons. Beaten down considerably, this important asset class cannot be too far from the bottom and is still churning out all-important cash payments."
|
| Are dividends in dire straits? |
| 02/06/09 Dividends |
"Many companies, especially banks, have had to slash or eliminate payouts. How low will dividends go?"
|
| Uncharted waters |
| 02/02/09 Dividends |
"The net result is that the market is pricing in a pretty severe outcome. American dividends more than halved between 1929 and 1931, but that was an extreme low; they have increased more than a hundredfold in nominal terms since then. According to Mr Long, the market is not expecting any dividend growth after 2010. Even in the depression, dividends more than doubled between 1931 and 1936. Figures from Britain, which date back to 1900, show that the biggest single fall in payouts was in 1919, when dividends fell 47%, but they more than doubled the following year. So the outlook for dividends, as reflected in swap prices, is historically unprecedented."
|
| Dividends and the three dwarfs |
| 12/31/08 Dividends |
"The importance of dividends for providing wealth to investors is self-evident. Dividends not only dwarf inflation, growth, and changing valuation levels individually, but they also dwarf the combined importance of inflation, growth, and changing valuation levels. This result is wildly at odds with conventional wisdom, which suggests that, while the return from bonds is wholly dependent on income, stocks provide growth first and income second. It is startling to realize that dividend growth has averaged less than 1 percent above inflation during the past 200-year period. And it is shocking that real per-share dividend and earnings growth on the S&P 500 Index since 1965 has been zero."
|
| Dividend ETFs: One way to ride out the storm |
| 12/13/08 Indexing Dividends |
"A jump back into the stock market right now will pay dividends right away. This is not a market-timing call, but rather a statement of fact. If you buy into an exchange-traded fund that tracks the broad stock market, you'll put yourself in a position to start receiving a surprisingly good flow of dividends."
|
| The myths of market underperformance |
| 11/26/08 Markets Dividends |
"Most members of the media strive for accuracy in their reporting and work very hard to get the facts right. The problem - many of the assertions that get the highest profile are based on flawed analysis of past stock market performance by pundits who distort history to get media coverage for their alarmist claims or by well meaning commentators who quite simply get the facts wrong. Among the common cautionary claims about investing in the stock market: 1. Investors made no money in the market from the mid 60s to early 80s. 2. It took 25 years for the market to recover to the level reached in 1929. 3. When inflation is taken into account, investors have lost money for long periods of time."
|
| Investors lick wounds from dividend cuts |
| 11/08/08 Dividends |
"Thirty-six companies listed on Standard & Poor's 500-stock index have cut or suspended dividends 46 times in 2008, sucking some $33.3 billion from investors' pockets, according to Standard & Poor's. From that sum, $30.8 billion came from financial companies, representing 37 individual actions."
|
| Fear and value |
| 10/09/08 World Dividends |
"The trend of late is clear: yields are rising, dramatically so in recent months. European yields lead the pack at 4.93% at last month's close, based on S&P Global Equity Indices. The U.S., Asia Pacific and the developed world-ex-US are also posting substantially higher dividend yields compared to recent years. For reasons that need no explanation, however, investors are reluctant to avail themselves of these higher yields. For comparison, the yield on the benchmark 10-year Treasury Note closed out September 2008 at 3.85%."
|
| Income 2008 |
| 09/23/08 Stingy Investing Dividends |
"Do you dream of relaxing on a sunny beach, drink in hand, while your investment portfolio throws off piles of cash? That's the life of an income investor. To help you get to that beach as quickly as possible, we have once again ranked the biggest trusts and stocks in Canada based on their ability to put steady streams of cash into your wallet."
|
| Take advantage of the dividend tax credit |
| 09/21/08 Taxes Dividends |
"It's interesting, but the marginal tax rate on eligible dividends is now lower than the rate on capital gains in most provinces at most income levels. In fact, at lower income levels, the marginal tax rate on eligible dividends is often negative. That is, adding more eligible dividend income to your tax return can actually reduce your overall tax bill. Why? Because the dividend tax credit available will offset not only that dividend income, but the tax on other income as well. British Columbia has the deepest negative marginal tax rate in 2008 at negative 15.55 per cent for the lowest income earners. This means, for example, that if you live in B.C., are in the lowest tax bracket, and you add one dollar of eligible dividend income, you'll actually pay 15.55 cents less in tax than without the dividend. What a bargain."
|
| There's more to the story than dividend yield |
| 08/27/08 Dividends |
"There are two ways a company returns capital to shareholders: dividends and share buybacks. True yield measures the dividend yield, adjusted for any growth or shrinkage in the number of shares outstanding."
|
| Dividends more reliable than share price rises |
| 07/25/08 Dividends |
"Growth in dividend payments is far more reliable than rises in share prices, according to analysis by Fidelity International. The research found that dividend payments from the UK market have shown an annual increase in all but five years since the beginning of 1965."
|
| S&P500 dividend yield highest since June 1995 |
| 07/16/08 Markets Dividends |
"The S&P 500 is currently yielding the most it has since June 1995 at 2.49%. After declining for about 20 years from the early 80s to the late 90s, the dividend yield has been on a steady rise this decade."
|
| Dividends start to crumble |
| 07/06/08 Dividends |
"If you look at dividend payouts in the past 12 months, there has been a 9.73 percent increase overall, Silverblatt said. Still, that's less than the rate the payouts rose from 2004 to 2007. Each of those years, dividend increases exceeded 11 percent, he said. Many companies are now decreasing the rate at which they increase their dividends." [How to turn 9.73 percent growth into an alarming headline.]
|
| Dividend tax slides below budget radar |
| 02/28/08 Cestnick Taxes Dividends |
"The status quo will hold in dividend taxation until 2010, when a three-year phased adjustment begins. Myron Knodel, manager of tax and estate planning at Investors Group in Winnipeg, illustrated how this will work with an example involving $100 in dividends paid by a bank. The current federal tax rate on dividends means you'd net $85.46, assuming you were in the top tax bracket. By 2012, your net take on the same $100 would be $80.68, a decline of $4.78, or 5.6 per cent."
|
| Dividend growth beyond the TSX 60 |
| 02/27/08 Dividends |
"The best dividend growth for stocks beyond the TSX 60 can be found in the financial sector - similar to the blue chips of the TSX 60. From 1995 to last July, however, mid-cap financial dividend stocks posted annualized gains of 20.2 per cent, compared with 17.9 per cent for their large-cap financial peers, and 10.8 per cent for the TSX Completion Index. Those figures do not include dividends."
|
| Dividends: A world of smart yield plays |
| 02/23/08 Dividends |
"In the ongoing search for income investments, many U.S. investors are seeking yield instruments overseas. That's because foreign companies are increasingly initiating or boosting dividend payments. As of Feb. 13, the dividend yield on the S&P Euro 350 index was 3.2%, vs. a 2.1% yield for the S&P 500. And it's not just Europe. Stocks in Asia and emerging markets are also increasingly paying dividends."
|
| Rising dividends are great |
| 02/22/08 Dividends |
"We love dividends. When we're having a bad day, nothing warms our soul like a juicy dividend increase. We're shallow that way. But not so shallow that we can't tolerate some dissension from people who actually have the temerity to argue that dividend increases maybe aren't the best use of a company's capital. And then these same people have the nerve to back up their case with cold, hard facts. When we looked at the title of the Thomson Financial report - "Baby, we got your dividend: What company actions do investors reward most?" - we were certain it would offer a ringing endorsement of our favourite investing strategy: Buying shares of companies that increase their dividends. So imagine our shock when the report told a different story. As you'll see, it doesn't suggest that dividend increases, per se, are a bad thing, but it does indicate that investors should pay attention to more than just the amount of cash companies pay out to shareholders, for dividend hikes can sometimes be a smokescreen for companies that are digging themselves into a hole."
|
| High-yield stocks for retirement |
| 12/06/07 Dividends |
"Ned Davis Research recently crunched the numbers for Money and found that a high-yielding portfolio launched at the worst time in the past 40 years - before the 1973-74 bear market - not only would have kept your income growing at the pace of inflation but would have increased in value eightfold (assuming an initial withdrawal rate of 4.5 percent). An S&P 500 portfolio, on the other hand, would have been used up by now. Over time, high-paying stocks also generate more income than government bonds. That's because while bond income is fixed, dividends aren't."
|
| Dividend index hides some dogs |
| 10/17/07 Indexing Dividends |
"We like dividends, particularly companies that raise their dividends regularly. For tax-efficient income and steady capital gains, it's hard to beat a basket of stocks that bump up their payouts every year. So, naturally, we were excited to hear that Standard & Poor's has launched a Canadian version of its "Dividend Aristocrats" index, with an exchange-traded fund expected to follow, possibly next year. Unfortunately, the more we learned about the index, the more glaring were its shortcomings."
|
| The high dividend yield return advantage |
| 10/03/07 Value Investing Tweedy Dividends |
"There is an abundance of empirical evidence which suggests that portfolios consisting of higher dividend yielding securities produce returns that are attractive relative to lower yielding portfolios and to overall stock market returns over long measurement periods."
|
| Dividend deluxe |
| 09/08/07 Dividends |
"Brace yourself for this because it's powerful stuff. If you buy the shares of a dividend grower today, in a decade you could be enjoying a tax-efficient flow of income with a double-digit yield. Bonds and guaranteed investment certificates offered double-digit yields back in the early 1990s, but it's hard to see that happening again any time soon. Income trusts commonly offered double-digit yields at one time, but mainly the weaker names do today. Anyway, few trusts offer the same level of blue-chip quality as the best dividend growers."
|
| The Income 100 |
| 08/13/07 Value Investing Stingy Investing Dividends |
"A year ago we helped you target Canada's best income trusts in our second All-Canadian Trust Guide. We ranked the largest trusts in Canada and assigned each a letter grade depending upon how its financial numbers stacked up. Despite the carnage in the trust sector as a result of new tax rules introduced in late 2006, our picks hit the bulls-eye. Our top-flight trusts - those rated either A or B - gained an average of 11.7% over the past year. That continues a streak of strong performance. Since we started ranking trusts in 2005, our top trusts have gained a total of 44.9%."
|
| No assembly required |
| 07/30/07 Real Estate Stingy Investing Dividends |
"Many of us would love to become landlords - if it just weren't for those darn tenants. Every prospective landlord hears stories about deadbeat tenants who skip town without paying the rent. And even if you have good tenants, the life of a property entrepreneur isn't easy. Nothing takes the shine off a potential investment faster than the thought of fielding complaints at two in the morning about clogged toilets or devoting part of your weekend to fixing the broken-down washing machine at your rental property. Fortunately, there is an easier way to become the next Donald Trump. Rather than buying rental units directly, why not invest in property through Real Estate Investment Trusts?"
|
| Dividends point the way |
| 04/11/07 Dividends |
"Dividend investing is often viewed as a conservative -- some might say boring -- strategy where you sacrifice first-rate share price gains for income through quarterly dividends. But it appears that if you buy the shares of companies that steadily crank up their dividends, you can have it all."
|
| The importance of measuring payout yield |
| 02/23/07 Dividends |
"Previous research showed that the dividend yield process changed remarkably during the 1980's and 1990's, but that the payout yield (dividends plus repurchases over price) changed very little. As such, we investigate the empirical implications of using various measures of payout yield rather than dividend yield for asset pricing models. We find that the widely documented decline in the predictive power of dividends for excess stock returns is due largely to the omission of alternative channels by which firms distribute and receive cash from shareholders. Statistically and economically significant predictability is found in the time series when payout (dividends plus repurchases) and net payout (dividends plus repurchases minus equity issuances) yields are used instead of dividend yield. In the cross-section, we find that payout yield contains information about expected stock returns exceeding that of dividend yield and that the high minus low payout yield portfolio is a priced factor. Finally, we show that trading on this characteristic leads to excess profits that can not be explained by the traditional risk factors."
|
| These dogs are barking |
| 12/11/06 Value Investing Dividends |
"At the beginning of this year, you would have looked foolhardy if you had piled into General Motors Corp., Merck & Co. Inc. or Verizon Communications Inc. All three stocks were beaten up, and they looked likely to receive more poundings in the months ahead. Amazingly, though, each one has since exceeded all but the most eccentric expectations. So far this year, GM shareholders are basking in an 80% share-price gain, while Merck and Verizon are up 43% and 23%, respectively. Those kinds of numbers would bring a smile to the lips of any investor. The problem is, who could have guessed that stocks that looked so bad at the start of 2006 would make such gains? Well, if you had followed the Dogs of the Dow stock-picking strategy when making your investments back in January, you would have put a good-sized chunk of money on GM, Merck and Verizon. And you would now be feeling pretty good about making calls that seemed to defy all common sense only a few months ago."
|
| Dividend stars: How to make up for trust tax |
| 11/11/06 Dividends |
"It's a great time to look hard at dividend stocks, even if many aren't exactly bargain-priced right now. Interest rates are expected to fall in the year ahead, which is positive for all income-producing investments. With the income trust market struggling to come to grips with a federal government crackdown on the sector, dividend stocks stand out as an obvious alternative. And if the stock market were to weaken next year, not an unlikely prospect with a fourth successive great year just about in the books, dividend stocks stand a good chance of escaping the worst effects."
|
| Sticking to 'Dogs of Dow' strategy |
| 09/21/06 Dividends |
"Hennessy invests 75 percent of his fund's net assets in the 10 highest-yielding Dow stocks and 25 percent in U.S. Treasuries that mature in less than a year. He buys the dogs in equal dollar amounts each month and, in effect, runs 12 mini-portfolios that hold the stocks for a year. Then he sells shares to reallocate the proceeds among the Dow's 10 new dogs. The fund has a Sharpe ratio of 0.74, less than the 1.24 average for large-company value funds, according to Morningstar. While a higher Sharpe ratio indicates better risk-adjusted performance, the Hennessy fund's ratio is lower than its peers because of its Treasury market investments."
|
| One-stop dividend shopping |
| 05/14/06 Dividends |
"How should you choose among these options? If you're seeking foreign dividends, PowerShares International is for you. If you value transparency, avoid the Mergent/Vanguard offering. Among the others, choices involve trade-offs. Indexes weighted by yield generally provide higher income than those weighted by market capitalization, but after-tax net can be lowered if the index includes REITs."
|
| How dogs can be an investor's best friend |
| 03/05/06 Dividends |
"The so-called dogs strategy is to buy the stocks in various sectors or markets with the highest dividend yield. The background here is that as a stock falls in price, its dividend yield rises. Your goal in buying a stock like this would be to benefit both from the high yield and a rebound in the share price over time."
|
| Dogs of the Dow |
| 01/12/06 Dividends |
"The Dogs of the Dow strategy has outperformed (total return) the broader index in three of the last five years. Why the success? It pays to be contrarian in stock investing, especially when dealing with pedigree companies like the Dow industrials. These blue chips may run into trouble, but they stand a decent chance of rebounding along with the value of their shares."
|
| Trusts versus dividends |
| 11/27/05 Dividends |
"Trusts are still king if you want the highest possible income, but dividend stocks will be surprisingly competitive on an after-tax basis. The appeal of dividends is all the greater when you consider that you're more likely to get a reliable, even growing, stream of dividends from the average blue-chip stock than you are to get an uninterrupted flow of cash distributions from the average income trust."
|
| Income trust decision announced |
| 11/24/05 Dividends |
"The federal government will cut dividend tax rates to deal with the tax arbitrage issue surrounding income trusts, and resume tax rulings on trust conversions" - Gee, only a few days before an expected election.
|
| Make room for dividend payers |
| 09/28/05 Dividends |
"You can't find a clearer sign that a company is profitable, well-managed, and committed to sharing the wealth with shareholders than a long track record of paying dividends. If the company has also consistently increased the amount of cash paid out in dividends, that's all the better. Studies have shown that the shares of companies that pay dividends tend to beat those that don't, usually with a lot less risk."
|
| Dividends and the three dwarfs |
| 09/26/05 Dividends |
"Dividends not only dwarf inflation, growth, and changing valuation levels individually, but they also dwarf the combined importance of inflation, growth, and changing valuation levels. This result is wildly at odds with conventional wisdom, which suggests that, while the return from bonds is wholly dependent on income, stocks provide growth first and income second."
|
| Buy cheap and get paid to wait |
| 09/11/05 Dividends |
"Remarkably, the most overlooked aspect of dividends is the power of compounding. Depending on your starting point, dividends have made up as much as 60% of the total return of the S&P 500 in the last 100 years. Additionally, because of recent tax code changes, dividends now offer a competitive after-tax return to many fixed-income instruments, especially considering the present low-yield environment."
|
| Nurture your dividend nest eggs |
| 02/13/05 Dividends |
"It pays to be somewhat contrarian and to buy those companies that are lowly rated and hence relatively unloved by the market. Similarly, it pays to buy smaller companies that are likely to be less well known by investors."
|
| Income and the long view |
| 02/13/05 Dividends |
"Raver points out that, on average, after ten years the percentage of income attributable to income and its reinvestment is greater than 50%; the value of the income at that point exceeds the value of changes in the asset price of equities. After 78 years - the period covered by Ibbotson - the proportion rises to 96.2% of total return attributable to the dividend portion!"
|
| Dividends count most in the long run |
| 02/13/05 Dividends |
"Statistically, the capital gains element in returns ultimately depends on dividends, or more precisely on the rate at which dividends grow. In a comparison of 17 countries, ABN-AMRO finds a close correlation between real returns (net of inflation) and the market average dividend yield plus the rate of dividend growth."
|
| Thinking small over dividends |
| 02/08/05 Dividends |
"An analysis by Columbia University professors Doron Nissim and Amir Ziv of dividend-paying stocks between 1963 and 1998 showed that boosts to the payouts are linked to future profitability. The business school professors published their conclusion in a December 2001 article in the Journal of Finance. Another study, published last year by Robert D. Arnott and Clifford S. Asness in the Financial Analysts Journal, shows that future profit growth is fastest when current dividend payouts are highest."
|
| Dogs can be investors' best friend |
| 01/08/05 Dividends |
"It looks like 2005 could shape up as the year of the dividend. Major investment dealers say in forecast after forecast that investors should look to dividend stocks this year as a way of playing defence in what is widely expected to be a soft year for stocks. Strategists like the classic safe sectors such as utilities, telecom, financials and consumer staples, but maybe you'd like to take a somewhat more aggressive stance."
|
| Stock repurchases are replacing dividends |
| 12/16/04 Dividends |
"A new study by Amy Dittmar and Robert Dittmar of the U-M's Stephen M. Ross School of Business shows that the fraction of earnings paid out in dividends decreased steadily over the course of the 1990s, declining from its peak of 55.6 percent in 1991 to a low of 26.3 percent in 1999. During that same time period, the share of public firms paying dividends reached an all-time low of 24 percent. In 1997, the dollar value of stock repurchases surpassed that of dividends paid for the first time."
|
| The death of dividends |
| 05/24/02 Dividends |
"the demise of dividends over the last 20 years was facilitated by greedy executives who used accounting shenanigans and the bull market to pocket significant stock option gains. Now that the bull market is over and accounting tricks are slowly being purged from financial statements all that remains is the greedy executives"
|
The Stingy News Weekly
|
Article Archive
|
Submit a Story
|
