Fourth Quarter 2013 Dividend Rate Increases $12.7 Billion

NEW YORK, Jan. 6, 2014 /PRNewswire/ -- S&P Dow Jones Indices announced today that dividend net increases (increases less decreases) rose $12.7 billion during the fourth quarter of 2013 for U.S. domestic common stock, compared to an $8.4 billion increase in the fourth quarter of 2012. 885 dividend increases were reported during the quarter, significantly lower than the tax incentivized 1,266 companies which raised dividends in 2012, but up 36.4% from the 649 companies which raised dividends in 2011. For the year, 2,895 issues increased their dividend rate, slightly up from the 2,887 which did so in 2012, but up over 48.2% from the 1,953 increases of 2011.

Of the approximately 10,000 U.S. traded issues, 51 companies decreased dividends (defined as either a decrease or suspension) in Q4 2013 compared to 154 in Q4 2012 and 27 in Q4 2011. For the year, 299 issues decreased their rate compared to 275 in 2012 and 101 in 2011.

"Dividends had a great year, with the actual cash payment increasing over 10% to set a new record," says Howard Silverblatt, Senior Index Analyst at S&P Dow Jones Indices. "Even the fourth quarter payments increased 6% year-over-year which speaks to the growth given how many companies paid their Q1 2013 dividend in Q4 2012. Payout rates, which historically average 52%, continue to remain near their low at 36%. At this point, we expect Q1 to be a very busy positive period for dividends, with 2014 setting another record for payments."

The percentage of non-S&P 500 domestic common issues (ASE, NYSE, NASD) paying a dividend increased to 47.7% in the fourth quarter from 47.4% in Q3, 47.3% in Q2 2013, 46.1% in Q1 2013, and 44.9% in Q4 2012.

418 companies (83.6%) in the large-cap S&P 500 pay a dividend. All 30 members of the Dow Jones Industrial Average pay a dividend.

Silverblatt determined that the weighted dividend yield declined to 2.44% from 2.60% in Q3 and 2.80% at the end of 2012. Silverblatt attributes this decline to the strong market price increase. "Dividends continue to be one of the few income generating alternatives available to investors. Interest rates have risen significantly this year, but are still historically low with alternative income producing instruments also low."

Looking ahead, Silverblatt notes the low payout ratio, record earnings and cash levels should permit companies to continue to grow dividends. "Just as important as the ability to pay is the resurrection of a friendlier atmosphere for total shareholder return. S&P Dow Jones Indices believes that this should translate into another strong, record setting dividend year for 2014 and a strong increase in share buybacks."

To download the S&P Indices Dividend Report, please visit www.spdji.com/indices/equity/sp-500 and click on "S&P 500 Monthly Dividend Report" from the "Additional Info" drop down box.

For more information about S&P Dow Jones Indices, please visit www.spdji.com.

Data for all common stocks (ASE, NYSE, NASD)

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SOURCE S&P Dow Jones Indices