As the below table notes, the dividend payers in the S&P 500 Index underperformed the non-payers by a wide margin in 2009. In looking at the 4-year annualized return for the payers, non-payers and the S&P 500 Index, it is the payers that are the underperforming asset class. The non-payers large outperformance in 2009 is impacting the 4-year return results. For contrarians, as 2010 unfolds, maybe the market will finally reward the dividend payers as this coming year unfolds.
Source: Standard & Poor's