Nine companies eliminating dividends in 2020 declined an average of 52% this year.
It’s important to note that these companies may have run out of cash if they didn’t.
Looks like it is 11 Cancellations
S&P 500 companies are discontinuing dividends faster than at any time since 2009. So far, 11 companies discontinued or omitted dividends, totaling $2.6 billion (2%) of the index’s #dividends paid in 4Q. About 80% of S&P #stocks pay a dividend: $SPY $DIA $QQQ https://t.co/gLBnXLSmj7
— BkWealth1 (@BkWealth1) March 31, 2020
Bank Dividends?
Bank dividend payments should be suspended https://t.co/ukijkJ1ab6
— Finance News (@ftfinancenews) March 30, 2020
The European Central Bank has instructed lenders to cancel all measures to return funds to shareholders. Regulators in the US and the UK should follow their example.
https://twitter.com/GinSecurities/status/1245086319505747969
UK’s Biggest Banks Scrap Dividends and Bonuses
Britain’s biggest banks scrap shareholder dividends and bonuses https://t.co/gb7UuxV9BR
— Standard News (@standardnews) March 31, 2020
Glencore Defers Dividend Payment
BREAKING: Commodity trading-mining giant Glencore defers dividend payment of $2.6bn to conserve cash | #OOTT #mining #copper pic.twitter.com/gWDfimBWrA
— Javier Blas (@JavierBlas) March 31, 2020
EasyJet Pays Dividend, Takes Bailout
https://twitter.com/AndyGbootneck/status/1244985057556783104
Easyjet payed out £174 MILLION in dividends.
Now using government money to pay it’s staff from the retention scheme. Unbelievable ! pic.twitter.com/gm6AWk2UBM— Martin (@martintimsbury) March 30, 2020
Hong Kong Still Pays Dividends
Hong Kong is the rare place where dividend bets aren’t being slashed https://t.co/2muehoeNeg
— Bloomberg (@business) March 31, 2020
All Shook Up
The recommendation to suspend dividends shakes up the hybrid #bond market because investors fear that this could also mean a stop of interest/coupon payments for AT1 bonds (see press release for @Rabobank cerificates) https://t.co/zK4uOUUwdq @boersenzeitung
— AKFixedIncome (@AKFixedIncome) March 31, 2020
Goldman Sachs Sees Dividend Slash of 25%
https://twitter.com/CyndxNet/status/1244965012671692801
A Different Kind of Dividend
Important to note that what’s happened *so far* is largely baked in based on (bad) choices the U.S. made a week to a month ago, or longer. The data lags our actions to an extent that folks don’t seem to fully appreciate. But making better choices *now* *will* pay dividends later.
— Nate Silver (@NateSilver538) March 29, 2020
Important to note that what’s happened *so far* is largely baked in based on (bad) choices the U.S. made a week to a month ago, or longer. The data lags our actions to an extent that folks don’t seem to fully appreciate. But making better choices *now* *will* pay dividends later.
Mike “Mish” Shedlock
But but someone here was pimping doing just that a few weeks ago (XOM).
Good luck.
I wasn’t clear.
Buying a stock based on dividend.
This is two consecutive days of tracking above what this model predicted. Today was supposed to end at 3755 at the high end and we already have hit 4053 by midnight on the east coast. Welcome to April.
Their stocks go down.
Stock dividends are mathematically identical to stock buybacks, so if you are going to ban one, you should ban the other. That way the employees and managers can keep any profits.
Not all stock buybacks and dividends should be banned, only those that are paid for by taking on more debt. It is not a good use of debt.
Rather than focusing on the source of funds, which can be obscure, how about limited buybacks and dividends in any year to no more than the book profits for the year?
In principle I would be okay with limiting buybacks or dividends to the book profits. When one thinks about these things carefully it is probably possible to distort any metric that is used, so I am not really certain that would work either.
As@Snow_Dog mentioned, the real problem is the cost of borrowing is being suppressed below fair market value, and there is an incentive to take on excessive debt to the point where companies either have to wreck their balance sheets or have it wrecked for them.
Benjamin Graham (the “Father of Value Investing”) once famously said that “The only reason to own equities is for the dividends.”
So, with no dividends, little-or-no-earnings and debt-impaired balance sheets, I would say that if you are not a “completely devoted member of the cult-of-equities”, these things are actually quite worthless.
Stock values will certainly go down. Mix that up with how much they went up and subtract the Trump Bump… What a price discovery mess. Meanwhile, We like many others are way long on utility stocks because they always have paid dividends. That stream will be pinched off as utility bills go unpaid. This will have a lasting effect as people don’t end up going back to work as expected. About the time people realize they don’t have as good a job as they thought they did, we will be moving into the second covid 19 wave.
Wait what? I wan my dividend… It allows me to be an arrogant spendthrift.
In the end, why bother paying dividends when the fed owns all stock?
Too bad the sheeple can’t/won’t do the same to the lending elite class. In other words, since the Fed-Bank-Gov cartel owns most real estate, then just don’t pay rent/mortgage after you lose your job. Instead the government is doing another backdoor bailout of the banks by cutting all sorts of slack to FHA debtors – which is pretty much everybody. Theft by other means.