Today, Standard & Poor's announced:
- total aggregate cash payments increased substantially, with total cash payments to common issues on the ASE, NYSE and NASD increasing 16%.
- 621 of the approximately 7,000 publicly owned companies that report dividend information to Standard & Poor's Dividend Record increased their dividend for the first quarter of 2007. This represented a 0.8% decline from the 626 issues raising their dividend in 2006.
Interestingly, Silverblatt notes,
"The improvement in dividends has slowed down its pace since the 2003 start, with companies remaining cautious about committing future funding and preferring to increase their stock buyback programs instead," says Howard Silverblatt, Senior Index Analyst at Standard & Poor's. "Dividend reductions continue to be low, reflecting the more assured approach to payments once the commitment is made."
"The companies that have a long history of annual dividend increases have kept up their end of the bargain; however, the issues that increase their rate every few years appear to be lagging. The importance of history is now playing a greater role in current policy," concludes Silverblatt.
The importance of history comment by Silverblatt is an indication that consistent dividend growers are more committed to future increases than the companies that periodically increase the dividend.
S&P: Companies Cautious with Dividends During First Quarter 2007
April 2, 2007