Mar 11th, 2009
Dude, Where’s My Dividend?
I love dividends. Or at least loved. A dividend, as we’ve discussed before, is a payment made by a company to its shareholders. Typically big, financially sound companies–remember those?–were the ones that paid dividends. Dividends have also received favorable tax treatment in recent years, which has made dividend paying stocks more popular with investors than they have been in a long time.
Unfortunately, companies are slashing if not eliminating their dividends. Wells Fargo, one of my favorite dividend paying stocks and one that has done better than a lot of bank stocks in these difficult times–but yes, they also have had a lot of issues with their stock price–just cut its dividend 85% to five cents per share.
Five cents!
That dividend was 34 cents a share a few days ago–34 cents of tax advantaged cash coming back to its investors, which really made things nice for those of us who own stock in them.
Or maybe owned, after that decision.
Of course, Wells Fargo is not alone. Many, many companies have been slashing their dividends to try to preserve cash in these trying times. Still, for those of us who have weathered the storm and supported the company be at least not selling the stock (or even buying larger stakes), this is like a kick in the gut.
I’d really like to have my dividends back!
[...] of years about 30%, but during that time the S&P 500 is down close to 40%; in the meantime, Wells Fargo has paid a reasonable dividend–although it cut it not long ago, much to my [...]