Dividend Payments Improved Again In the Second Quarter

Dividend investors received good news today as Standard & Poors released a report showing that dividend payments improved again in the second quarter.


The number of stocks announcing dividend increases rose by 33 percent this last quarter to 444 companies. Last year only 335 stocks gave dividend increases in the second quarter.


Those dividend increases resulted in an additional $11.2 billion in dividend payments to investors in the second quarter. New dividend initiations from stocks like Cypress Semiconductor, Humana and Vail Resorts contributed an additional $1.5 billion in dividend payments.


In the first quarter of 2011, 462 companies announced dividend increases. 10 stocks in the S&P 500 initiated a dividend as payouts surged in the first quarter.


S&P Senior Index Analyst Howard Silverblatt commented in the press release, “If dividends were a paycheck, dividend investors would have received an 11.1% raise in the first half of 2011. Dividend increases are commitments not just to current payments but to upcoming obligations. Companies need to be sure that their earnings and cash flow will continue into future periods to satisfy payments.”


Another encouraging sign is that there have also been fewer companies this year who are cutting their dividend payments. In the second quarter of 2011 only 21 stocks announced dividend cuts. That was a 38 percent improvement over last year.


The average dividend yield for stocks paying a regular dividend rose to 2.51 percent in the second quarter. The average yield for dividend stocks in the S&P 500 index is currently 2.29 percent.


The dividend increases are expected to continue in the second half of 2011 although at a slower pace than in the first half.

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