Dividends and “Corporate Scrooges”: WWBGD (What Would Ben Graham Do)?

While U.S. companies have been raking in big profits since the end of the Great Recession, much of those profits are staying locked up on corporate balance sheets. And, in a recent column, The Wall Street Journal’s Jason Zweig takes a look at why that’s happening, and what he thinks the great Benjamin Graham would say about such tactics. “To be sure, at many companies the cash piling up is at global operations that generate ‘undistributed foreign earnings’ that can’t be brought home, under U.S. law, without incurring taxes of up to 35%. But hundreds of billions in cash remain […]

Reese: Five Dividend Plays — With or Without the Tax Break

In his latest article for Forbes.com, Validea CEO John Reese takes a look at five high-dividend-paying stocks that could get a boost from the recent extension of the Bush-era tax credits. “By extending the 15% cap on qualified dividends for two more years, the proposal could mean a boost in some firms’ dividend payouts, and a boost for dividend-paying stocks,” Reese writes. “Companies that had been using the impending dividend tax hike as a reason not to issue or up their dividends can no longer use that excuse, and investors who’d been leery of buying high-dividend stocks no longer have […]

O’Shaughnessy: Want Income? Look at Stocks, Not Bonds

Conventional wisdom is that investors looking for income (as opposed to capital gains) should focus on bonds. But in his latest market commentary on his firm’s web site, James O’Shaughnessy says history shows there is a far better way. O’Shaughnessy’s firm conducted a study that covered the period from Dec. 31, 1962 through the end of 2009, looking to see how much money income investors would have made had they invested in high-dividend stocks (via his “Enhanced Dividend” strategy), and how much they would have made by investing in 10-year Treasuries. The study used a $250,000 initial investment, and assumed […]

13 Stocks with Big Dividends — and the Fundamentals to Boot

Earlier this month, The Wall Street Journal had an interesting piece on the challenges — and opportunities — facing income investors. Dividend payouts have dropped dramatically since the market made its big declines last year, with second-quarter S&P 500 dividends coming in $14.3 billion lower than they were a year ago — the largest drop in more than 40 years. June dividends alone for the index were down $6.6 billion, the largest drop on record, the Journal’s Tom Lauricella reports. But there’s another side of the coin: “Dividends are down,” S&P’s Howard Silverblatt told the Journal, “but the market is […]