S&P 500: Dividend Cuts Accelerate in November

Dividend cuts for companies in the S&P 500 accelerated in November versus the same period last year. Standard & Poor's reports:

• November cuts aggregate $4.89 billion.

• The three month total stands at $20.85 billion and year to date the total is $38.0 billion.

• S&P expects 4th quarter dividend payments to decline by 10%.

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Outside the S&P 500 Index, S&P indicates November was the worst month for dividends since 1956-the time at which the company began tracking dividend payments. Year to date, 55 companies have cut their dividend versus 11 in the same period last year.

With companies anticipated to experience a unfavorable economic environment in 2009, dividend investors are advised to evaluate a company's cash flow to judge the stability of the company's future dividend payments.

Source:

• S&P 500 Market Attributes (pdf file) Standard & Poor's, By: Howard Silverblatt, Senior Index Analyst, November 2008.

Comments

[Smarty_Pants:]

One other consideration is the number of S&P 500 companies that no longer qualify to be in the index due to loss of market cap.

I have read that over 1/3 of the current S&P 500 companies no longer qualify to be in the index. If they are replaced will the new companies be paying dividends, if so how much?

Consumer retrenching is just getting under way. Expect profits and dividends to be soft for some time to come.

2008 Dec 03 11:13 AM

[David I. Te...:]

I recently wrote a post detailing S&P 500 companies with market caps below $1 billion. The information can be found at the following link:

disciplinedinvesting.b...


On Dec 03 11:13 AM Smarty_Pants wrote:

> One other consideration is the number of S&P 500 companies that
> no longer qualify to be in the index due to loss of market cap.

>
>
> I have read that over 1/3 of the current S&P 500 companies no
> longer qualify to be in the index. If they are replaced will the
> new companies be paying dividends, if so how much?
>
> Consumer retrenching is just getting under way. Expect profits and
> dividends to be soft for some time to come.

2008 Dec 03 10:09 PM