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The income potential of equities is positive right now – especially in this low interest rate and low inflation environment. The S&P 500 currently boasts a yield of around 2.0% and (assuming no recession) dividends should continue to grow.
What does this chart highlight? The popularity of dividend payments
1. The number of dividend-paying companies over the past year is higher than at any point since the early 1980s:
- Nearly 85% of S&P 500 companies pay a cash dividend
- 67% of the S&P 500 companies have raised or initiated a cash dividend over the past year
3. S&P 500 companies are paying out roughly 35% of earnings in cash dividends today, a level that provides capital return to shareholders and capital retention to support future growth.
4. S&P 500 cash dividends paid have risen at a 10.3% annual rate over the past 10 years. Dividends fell in just one calendar year (2009) of the past 10. This was largely due to cuts in the financial sector. According to Standard & Poor’s, dividend growth resumed in 2010 and has accelerated ever since.
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Unless otherwise noted, all data is as of January 31, 2015.
Market conditions are extremely fluid and change frequently.
This blog post is provided for informational purposes only and should not be construed as investment advice. Any opinions or forecasts contained herein reflect the
subjective judgments and assumptions of the authors only and do not necessarily reflect the views of Loomis, Sayles & Company, L.P. Information, including
that obtained from outside sources, is believed to be correct, but Loomis Sayles cannot guarantee its accuracy. This material cannot be copied, reproduced or
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