Tuesday, March 03, 2009

Paying Attention To Dividends More Important Than Ever

Standard & Poor's has released dividend data for the S&P 500 Index through the month of February. Any dividend investor knows cuts have been coming at a fast and furious pace.

Do in part to the dividend cuts by high profile companies like General Electric (GE), Dow Chemical (DOW) and Macy's (M), just to name a few, companies seem more willing to cut the company dividend at this time in order to preserve cash.
  • Negative dividend actions total 23 in February versus just 2 in February of 2008.
  • Year to date there have been 34 negative dividend actions versus 9 in the first two months of February last year.
  • Not all the cuts are from the financial sector. In January 80% of the cuts were financials; however, in February less than 50% of the cuts were financial firms.
(click to enlarge)

dividend actions for February 2009
An an average return basis, the dividend paying stocks in the S&P 500 Index lost a great deal of ground to the non-payers. The payer's average return in February totaled -20.42% versus -12.52 for the non-payers.

payers vs. non payers performance as of February 2009A detailed listing of the dividend actions in outlined in the dividend action spreadsheet below.

Data Source: Standard & Poor's

1 comment :

Anonymous said...

David: Very well done. Thanks!

Best Wishes,