Are you new to dividend stocks? Do you get confused by the term ex-dividend stocks? One type of return that investors in the stock market prefer is dividend income or regular return on their investment. When investors sell stocks near the time of an expected issue of dividends, they should take care about the timing, depending on whether they desire to keep their dividend rights or sell the shares ahead of the dividend record dates.
Buyers are required to pay attention to dividend declarations in order to ensure that they understand when to make stock purchases. Stock will be worth somewhat higher prior to dividend record dates, because people will be entitled to a dividend, and the value will move down afterward. On the announcement date, when a company officially reveals information regarding a suggested dividend issue, it also provide information about when the record, ex-dividend, and payment dates will arrive. This enables both buyers and sellers to plan ahead.
Always keep in your mind that you need to be the shareholder of record on the ex-dividend date to be entitled to receive the dividend. This does not mean buying the stock on the ex-dividend date will lead you to receive the most recently declared dividend. The trade requires time to get settled, therefore, money must have been exchanged, and the title to the stock must have been changed to your name.
Below discussed are five companies that are reaching their ex-dividend dates within the week January 26, 2014 – January 31, 2015.
ADT Corp is a new dividend payer as the first payment it made was in 2012. But, it has now been paying dividend each quarter and has raised the payout from $0.20. The new dividend is $0.21 and marks the second consecutive year of increasing dividend. The stock has a current yield of 2.5%, paying a annual dividend of 84 cents a share.
Ford Motor Co. recently hiked its current payout by 20 percent to $0.15 from $0.125. The increase, the third boost in as many years, comes nearly a year after Ford lifted its dividend by 25 percent to 10 cents a shares from a nickel. The company resumed the dividend in 2012 at 5 cents that was the first payout to shareholders since September 2006.
American Capital Agency Corp. has no long history of paying dividend as the first payment was made in 2008 but is now declaring dividend oftenly as distributed 7 times during the last 12 months. Over the past five years, the REIT has seen its dividend growth rate decline by a 11.48%. Over the past 3 years, dividend growth rate dropped 22%. At present, the yearly rate of $2.64 gives the stock a dividend yield of 12.30 percent.
Texas Instruments Inc. pays a generous quarterly dividend of $0.34 for a current yield of 2.5%. The company has been paid out cash to shareholders for the past 53 years, and has increased dividend payouts every year for the last 11 years. Dividend payments have been increased by roughly 23.25% annually in the past five years, and dividend payments were increased by a higher 31% over the past 3 years.
The Goodyear Tire & Rubber Company started paying dividends in 1990 but has announced just 1 consecutive dividend raise since then. In the last twelve months, it has paid around 11% of its profit regularly to shareholders. Its shares have delivered a compound annual growth of 75.6% over 5 years and at a yearly dividend of $0.25 per share, it has a dividend yield of about 1%.