To find companies with big dividend payouts in dollar terms and attractive yields, Barron’s started with the most recent Janus Henderson Quarterly Dividend Index, which analyzes global dividend activity four times a year and includes a list of the top global dividend payers each quarter. It found that Apple is among the top payers of dividends in total dollars, but its yield is a mere 0.6%.
Lawrence C. Strauss for Barron’s:
Sometimes a stock can have a big payout in terms of absolute dollars and a high dividend yield.
To find companies with big payouts in dollar terms and attractive yields, Barron’s started with the most recent Janus Henderson Quarterly Dividend Index, which analyzes global dividend activity four times a year and includes a list of the top global dividend payers each quarter.
A big dividend distribution in absolute dollars doesn’t necessarily come with a big yield.
Consider Microsoft and Apple, which recently yielded 0.9% and 0.6%, respectively. But these companies ranked first ($4.6 billion) and third ($3.6 billion) in actual dollars spent on dividends — testament to their strong cash-flow engines.
This column argued recently that Apple could easily pay a lot more in dividends and boost its yield from under 1% and its payout ratio — the percentage of earnings paid out in dividends.
MacDailyNews Take: Clearly, Apple prioritizes buybacks over dividends by a large margin.
On April 28th, Apple announced that the company’s board of directors had declared a cash dividend of $0.23 per share of the company’s common stock, an increase of 5 percent alongside authorizing an increase of $90 billion to the existing share repurchase program. As of the beginning of this year, Apple has invested more than $467 billion on share repurchases over the past decade.
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Thank goodnesses Apple spends most of its cash return to shareholders through share buybacks. Dividends are double taxed. The current dividend gives shareholders some liquidity. It’s a good relationship between the 2 options.
Yeah, the tax implication of dividends is not well understood by a lot of so-called investors. Those who do their own taxes on TurboTax, etc. see this for real. Yet another example of Apple thinking things through on a deeper level — Investor Experience
Is it still ‘double-taxed’ if you hold your dividend bearing stock in a Roth IRA?
That’s where I have a large chunk of Apple stock, so I’d love to have a bigger dividend. It’s tax-free income.
No. And if it’s in your Roth account, it’s not taxed at all, ever. If you hold AAPL outside of your retirement account(s) and you don’t hold AAPL inside those account(s), you’re financially nuts. I’ve got a self-directed Roth, and no product any financial advisor has advised me on has ever come close, long-term, to my gains on my all-in AAPL portfolio. (Is it really a portfolio if it only holds one stock?) They classify me as a high-risk investor. But, I assure you, I am very conservative financially. I don’t trade. I buy and hold. The only time I ever sold shares was during the Covid crash — in order to buy them all back (and then some) at a lower price shortly thereafter. (Others who post here were doing the same at the same time, for the same reasons.) I’m thrilled that a company I love has seen such financial success. But even so, I must go where the money is — and where I have very good reason to believe the money will be. With only minor bumps along the way here and there (and possibly this year, too, but let’s wait and see), all this century has been a steady climb toward a very comfortable retirement. (So why am I disgruntled? Apple’s dividends are a mean joke on longterm shareholders like me. Their buyback/dividend ratio is way out of whack for a company their size. See my other comment.)
Shows the tax system is complicated garbage. There are too many rules that incentivize whacked actions.
I remember a time when owning stock meant no dividends, zip nada. I’m happy that they offer something now.
I remember that time, too, but that was then, and this is now. Apple is now (usually) the most valuable company in the world. Great responsibility comes with that. It needs to keep up and do the right thing. It should more than quadruple its dividend.
MDN keeps referring to Apple’s increase as 5%, but it was one cent, from $0.22 to $0.23. One measly penny. That is literally the absolute least they could have done. And these buybacks have not kept the stock from dropping nearly $40 a share from its most recent all-time high (currently about $30 less). For those of us who reinvest those dividends back into AAPL stock, it doesn’t amount to a whole lot. Apple should rebalance its buybacks/dividend balance to pay out at least $1.00 per share per quarter. That would only be $4.00 year vs. the current $0.92 per year, and they would still be doing buybacks by the truckload. It’s the shareholders’ money, and long-term shareholders are getting the short end here.