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Entries in Dividends (3)

Wednesday
Dec192012

The 10 Largest Fiscal Cliff Dividend Tax Winners

Jerome Favre/Bloomberg via Getty Images(NEW YORK) -- While Congress and the White House negotiate a mix of tax increases and budget cuts, many firms decided to pay shareholders an early or special dividend ahead of an anticipated increase in the dividend tax rate.

Not surprisingly, the largest individual shareholders of these companies often sit on the board of directors, reaping millions of dollars in tax savings.

Wealth-X, an information research firm of ultra high-net worth individuals worth over $30 million, compiled a list of the 10 largest special dividend-paying companies based in the U.S. this year as of Dec. 12 and the tax savings their largest individual shareholders are receiving ahead of the fiscal cliff.

The dividend tax rate is currently at 15 percent but the president has proposed increasing it to upwards of 43.4 percent starting in 2013 to plug the ballooning trillion-dollar budget deficit.

All 10 individuals, led by Sheldon Adelson, chairman and CEO of the Las Vegas Sands, either sit on the board of directors, are senior executive directors, chairmen or CEOs of the listed companies.

In the fourth quarter, the total dividends received by these shareholders exceeded $2.1 billion, which is $602 million more than what they would receive should tax rates increase.

The combined wealth of the shareholders on the list is $110.4 billion, representing one fifth of the combined market capitalization of the top 10 largest dividend-paying companies.

The dividends received by the shareholders on the list represent 15 percent of the more than $14 billion payout by the top 10 companies:

  1. Sheldon Adelson, Las Vegas Sands: $1.2 billion
  2. Thomas Frist III, HCA: $497 million
  3. Lawrence Ellison, Oracle: $200 million
  4. Charles Johnson, Franklin Resources: $105 million
  5. Stephen Wynn, Wynn Resorts: $75 million
  6. Vincent Ryan, Iron Mountain: $29 million
  7. Russell Wight Jr., Alexander's: $27 million
  8. James Sinegal, Costco: $14 million
  9. Cornwell Appleby, Booz Allen Hamilton: $10 million
  10. James Walton, Walmart: $4 million

Copyright 2012 ABC News Radio

Monday
Dec172012

Boeing Raising Dividend, Resuming Stock Repurchases

Stephen Morton/Bloomberg via Getty Images(CHICAGO) -- Boeing said Monday it plans to increase its quarterly dividend by 10 percent to 48.5 cents per share and that it will also resume its $7 billion share buyback program.

Boeing Chairman, President and CEO Jim McNerney said in a statement Monday that the company's recent positive performance permits the Chicago-based company to redeploy cash back to its shareholders.

"Strong cash generation, consistently solid core operating performance and a positive growth outlook enable us to take these steps to deliver value for our shareholders," McNerney said. "As returns accelerate on the investments we made in innovative new products, we plan to continue our balanced cash deployment strategy, increasing returns to shareholders, investing in our core businesses and our workforce, and maintaining a strong balance sheet with healthy credit ratings."

The company's board of directors initially authorized the repurchase program in October 2007.  Now, Boeing says that after its fourth quarter earnings announcement in January 2013, shares can be repurchased. The buyback program is expected to use the remaining $3.6 billion left from its original authorization.

Boeing says the dividend is payable March 8, 2013 to shareholders of record as of Feb. 15, 2013.

Copyright 2012 ABC News Radio

Thursday
Aug092012

Firms Paying Dividends Highest in Decade

iStockphoto/Thinkstock(NEW YORK) -- The number of S&P 500 companies that have paid dividends to their shareholders, 402, is the highest since 1999.

The number of dividend payers is the highest it’s been in the 21st century, which is good news for shareholders, since dividends, not stock prices, have brought investors the best returns in recent years, according to the Wall Street Journal’s CFO Report.

Dividend payments in cash are expected to hit a record $275 billion in 2012, up from $241 billion last year.

Because companies are loaded with cash and feeling pressure from investors to share it, firms are slowly starting to pay dividends, usually in small percentages like 1 or 1.5 percent.

This year, Apple announced its first dividend since 1995. The company will pay a quarterly cash dividend of $2.65 per share of its common stock, payable Aug. 16, less than one percent of its current trading price. Apple stock was trading at $620.14, up 0.48 percent in the mid-afternoon.

“People are disappointed in the way the stock market has performed in last 12 years,” said Josh Peters, editor of DividendInvestor, published by the investment firm Morningstar.  “It crashed and came back again but stocks haven’t really made forward progress.”

Peters said he expects the number of companies that pay dividends to grow over time, in part to meet investors’ expectations.

Historically, dividend payments have been a big portion of investors’ portfolios.   Of the S&P 500’s nominal total return from 1910 to 2010, dividend yield and dividend growth comprised 90 percent of growth for stock holders.

Some companies are known for paying consistent dividends, like General Mills, which paid $856 million for the year in dividends.

Peters said companies that focus on consistently paying dividends to shareholders often are more focused on long-term growth strategies.

“It’s a virtuous cycle,” Peters said. “When they pay a dividend, they attract a shareholder that stays for the long term, and the management runs the business for the long term and thinks about how to continue paying a dividend over time.”

Copyright 2012 ABC News Radio







ABC News Radio