Deprecated: mysql_connect(): The mysql extension is deprecated and will be removed in the future: use mysqli or PDO instead in /home/a26f9f83/public_html/articles/includes/config.php on line 159
Dividend Paying Stocks > NetSparsh - Viral Content you Love & Share

Dividend Paying Stocks

I would like to share with the reader an article printed in the financial section of U.S.A. Today on March 7, 2003 which exemplifies the awesome power of a stock dividend.

MICROSOFT TO ISSUE FIRST DIVIDEND TODAY:

Microsoft investors will get their first payday today, when the tech giant shells out its first dividend. At 8 cents a share, the dividend will cost the company $850 million. Co-founder Bill Gates, who owns about 1.2 billion shares will receive a dividend of $96.5 million. The dividend marks a shift for Microsoft, which had long hoarded cash - to the tune of $43.4 billion ? for research, acquisitions and legal claims.

After reading this article I couldn't help thinking about a report, which I believe stated that there were an estimated 33 million people in America living under the official poverty level. Bill Gates, by giving away his Microsoft dividend to those living under the poverty level could begin to create 96 millionaires, year after year after year. What a boost to the economy that would be! Imagine all those new millionaires every year spending money on something other than food, Salvation Army clothing and shelter.

Bill Gates (by giving away his Microsoft dividend) could begin to eliminate all the hardships for those people currently living under the poverty level.

Of course, I would probably start feeling sorry for all those people who were living right at the poverty level. I could almost hear Ma telling Pa now, "If we only didn't sell those $40.00 worth of aluminum cans, we could have been millionaires right now." Then again, those newly created millionaires would probably begin buying computers filled with Microsoft software and Bill Gates would start getting his money back. And, if that wasn't enough, the newly created millionaires probably hadn't read my book! They would probably start using their computers to start day trading in the stock market and end up right back where they started. Holy moly! I better finish this book or they won't stand a chance!

(Note: Bill Gates and family have already given millions and millions to charity. It was announced on CNBC that on April 24, 2003 Bill Gates had just donated 28 million dollars to S. Africa's AIDS program.)

As an individual investor in the stock market for almost 40 years I have found that companies that raise their dividend every year outperform those companies that stop or trim their dividends. For example, Dominion Resources had raised their dividend from 1984 to 1994 every year, and then stopped in 1994. Since then the company continues to pay a 64½ cent a share dividend, with a dividend yield of around 4 percent a year. The stocks performance since 1994 has been mediocre, rising in price from the 40 dollar range in 1994 to the 60 dollar range in 2004.

Now compare that stock's performance with Comerica, a company that has raised their dividend for the past 35 consecutive years. In April of 2003, Comerica's stock price was around 37 dollars a share, paying a dividend yield of around 5%. Today, July 20, 2004 the stock closed at $58.28 a share, paying a dividend yield of 3.57%. A $21.00 a share move in the stock in 1 year and 3 months and in March of 2005 the company will probably raise their dividend again for the 36th consecutive year. (By the way, Comerica's stock performance for the past 14½ years (just by having the dividends rolled back into the stock) has returned a little better than 15% a year, compounded annually.)

The simple point I'm trying to make is to invest in those companies that have a history of raising their dividend every year. There are hundreds of them. A company that just pays a dividend is not good enough; find those companies with a historical record of raising their dividend every year.

--

You have permission to this article either electronically or in print as long as the author bylines are included with a live link, and the article is not changed in any way (typos excluded.) Please provide a courtesy e-mail to charles@thestockopolyplan.com telling where the article was published. (646 word count)

Charles M. O'Melia is an individual investor with almost 40 years of experience and passion for the stock market. Author of the book 'The Stockopoly Plan', published by American-Book Publishing. For more excerpts from "The Stockopoly Plan' please visit http://www.thestockopolyplan.com

In The News:

This RSS feed URL is deprecated, please update. New URLs can be found in the footers at https://news.google.com/news

Motley Fool

200 Stock Advisor Picks, 6 Conclusions, No. 5: "Using This Service, You Should Beat Your Mutual Funds"
Motley Fool
Journey in your mind back to March 2002. The stock market was still stumbling around in the aftermath of the dot-com crash, and retail investors were running scared. It was in that environment that Tom and David Gardner launched a monthly newsletter ...

and more »

Barron's

The Stock Market Was Scary This Week. Here Are 5 Mutual Funds for Income Investors
Barron's
Investors have plenty of options for income-oriented mutual funds. The table below lists five such portfolios, which are also known as multi-asset income funds. “Investors really need to look a bit deeper to see exactly what the strategy is to generate ...


CNBC

Cramer: We could be facing a cold war with China, and these stocks may be sacrificed
CNBC
"You have to be cognizant that the strongest stocks today were the techs that have no meaningful exposure to China, namely Amazon, Alphabet and Facebook," he said. "Bottom line? As mutual funds dump stocks of companies that trade with the enemy as ...

and more »

Forbes

Billion-Dollar Portfolio: 10 Stocks To Buy Now
Forbes
Under my definition, that's the line between a small-capitalization stock and a mid-capitalization one. I like this size because such stocks are small enough that they haven't been discovered yet by most big mutual funds or pension funds, but they're ...


NBC4 Washington

How to Protect Your Investments From Being Hacked
NBC4 Washington
Most people hold far more assets in stocks, mutual funds and retirement accounts than in bank accounts, making them prime targets for hackers. “We've seen activity, now, involving scamming 401(k) accounts,” Cyber Scout CEO Adam Levin said. That fraud ...


Zacks.com

Will Record Outflows Spell Doom for Mutual Funds?
Zacks.com
However, in the preceding week, all three major stock indexes fell and posted the worst weekly performance since March. Both the Dow 30 and the S&P 500 registered weekly increase after three consecutive weeks of loss, while the ... As per the latest ...

and more »

Investor's Business Daily

Growth Stocks That Fuel This Mutual Fund Manager's Outperformance
Investor's Business Daily
31, the fund managers had outperformed the S&P 500 for the calendar year as well as the previous three, five and 10 years. That four-for-four outperformance makes the Prudential mutual funds' portfolio an IBD Best Mutual Funds Awards winner. Merely 10% ...


Nasdaq

Is Schwab Total Stock Market (SWTSX) a Strong Mutual Fund Pick Right Now?
Nasdaq
If you're looking for an Index fund category, then a possible option is Schwab Total Stock Market (SWTSX). The fund does not have a Zacks Mutual Fund Rank, though we have been able to explore other metrics like performance, volatility, and cost ...
3 Best Mutual Funds to Buy as Industrial Production Picks Up AgainInvestorplace.com

all 4 news articles »

Investor's Business Daily

Best Mutual Funds Buying CVS, United, Lowe's And These Other Top Stocks
Investor's Business Daily
Eleven stocks from the medical sector made this month's list. Thirty-seven top performing mutual funds invested just under an estimated $160 million in biotech industry leader Biogen. Abbott Laboratories (ABT) (35 funds, $258 million), HCA Healthcare ...


TheStreet.com

US Stock Futures Gain as China Tax Pledge Sparks Rally, Steadies Global Market
TheStreet.com
Want to Buy $1 Worth of Stock for 90 Cents or Less? You can with certain so-called "closed-end" mutual funds - an often overlooked investment class. Click here to register for a free online video in which TheStreet's retirement expert Robert Powell and ...

and more »
Google News

Municipal Bonds

Because there are so many stocks that are NOT paying... Read More

VooDoo Training For the Stock Market

If you go to Haiti or other places in the... Read More

My Stock - Right or Wrong

We all know the expression, "My country, right or wrong",... Read More

Two for the Money

Look back over the years and try to remember how... Read More

Leverage - Margin Debt

What is leverage?Here is a definition of leverage from an... Read More

Bull or Bear?

Cat or dog? Maybe Zebra. Shucks, I don't know, but... Read More

Stealth Bull

If you have been watching the stock market at all... Read More

Stuff

I continually hear from economists, talking heads, other market letter... Read More

Mutual Fund Commissions

You have heard about a particular mutual fund from a... Read More

The Skinny on Mutual Fund Investing

Mutual fund investing is a lot like Thai cooking. Everyone... Read More

Historical Briefing: Stocks, Finance and Money

The World Bank claims that some two billion of the... Read More

Trading as a Business

What can I expect to make my first year of... Read More

Dispelling Illusions of the Stock Market

How can you dispel an illusion unless you look directly... Read More

Stock Trading Diversification

This is the continuing story of our two imaginary traders,... Read More

Shorting Stocks ? The Basics, Part II of II

After the publication of the first part of this two... Read More

The Stock Market - How Just One Question Will Tell You All You Need To Know About Your Stock Broker

Last time we looked at the real performance of the... Read More

Stock Market Investing: Knowing When (and when not) to Sell

One of the greatest challenges of investing in stocks is... Read More

Learn to Calculate a Stock?s Pivot Point

Stocks breakout from properly formed bases everyday but many investors... Read More

Bollinger Bands Strategies

The Bollinger Band theory is designed to depict the volatility... Read More

365/7/24

What does it take to be a stock trader? It... Read More

The Bottom?

Every day I hear someone on CNBC proclaim that "this... Read More

Stock Insurance

You have a lock on your house. You have a... Read More

Online Trading Strategy: Collecting Cash when Stocks Go UP - It PAYS to Know More than Others

When it comes to stock market trading it PAYS to... Read More

Mutual Funds are Dead

You may have wondered why your mutual funds have been... Read More

Enron Cure

Let's hope you did not have any of the Enron... Read More