Tuesday, December 02, 2008

Dividend Deterioration

Dividend cuts for companies in the S&P 500 accelerated in November versus the same period last year. Standard & Poor's reports:
  • November cuts aggregate $4.89 billion.
  • The three month total stands at $20.85 billion and year to date the total is $38.0 billion.
  • S&P expects 4th quarter dividend payments to decline by 10%.
(click to enlarge)

dividend actions by month as of November 2008
Outside the S&P 500 Index, S&P indicates November was the worst month for dividends since 1956-the time at which the company began tracking dividend payments. Year to date, 55 companies have cut their dividend versus 11 in the same period last year.

With companies anticipated to experience a unfavorable economic environment in 2009, dividend investors are advised to evaluate a company's cash flow to judge the stability of the company's future dividend payments.


S&P 500 Market Attributes (PDF)
Standard & Poor's
By: Howard Silverblatt, Senior Index Analyst
November 2008

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