Third Quarter 2013 Dividend Rate Increases $11.9 Billion

NEW YORK, Oct. 3, 2013 /PRNewswire/ -- S&P Dow Jones Indices announced today that dividend net increases (increases less decreases) rose $11.9 billion during the third quarter of 2013 for U.S. domestic common stock, compared to an $8.8 billion increase in the third quarter of 2012.  475 dividend increases were reported during the quarter, equating to an 8.2% gain over the 439 dividend increases reported during third quarter of 2012.

Of the approximately 10,000 U.S. traded issues, 44 companies decreased dividends in Q3 2013 compared to 53 in Q3 2012. For the year-to-date nine month period, there were 2,010 positive dividend events and 287 negative events (defined as either a decrease or suspension) compared to 1,621 positive events and 121 negative events during the 9 month period ending September 2012.

"Dividends continued to increase in the third quarter with actual cash payments increasing over 14% year-over-year and the forward indicated dividend setting another all-time high," says Howard Silverblatt, Senior Index Analyst at S&P Dow Jones Indices. "Payout rates, which historically average 52%, continue to remain near their lows at 33%. At this point, we expect Q4 to be a busy positive period, especially for large-caps, which have been growing at a faster pace."

The percentage of non-S&P 500 domestic common issues (ASE, NYSE, NASD) paying a dividend increased slightly to 47.4% in the third quarter from 47.3% in Q2 2013 and up from 46.1% in Q1 2013 and 44.5% in Q3 2012. The paying issues in the large-cap S&P 500 reached 83.9% (419 issues), a level not seen since November 1998 (420 issues). All 30 members of the Dow Jones Industrial Average pay a dividend.

Silverblatt determined that the weighted dividend yield declined to 2.60% from 2.65% at the end of Q2 and the 2.66% yield at the end of Q3 2012, which Silverblatt attributed partially to the Q3 increase in prices. "Dividends continue to be one of the few income generating alternatives to investors.  Interest rates, while up, remain artificially low as the timing of the start of tapering continues to be discussed," says Silverblatt.

Looking ahead, Silverblatt notes the low payout ratio and current record high level of earnings and available cash. "Fourth quarter comparisons will be difficult as last year saw many accelerated payments due to an expected tax law change," adds Silverblatt. "Still, dividend rates are higher which gives us a good shot to beat last year's increases. Either way, the actual cash payments for 2013 are set to post a double-digit gain over 2012, setting a new record, with 2014 already on track to set another record."

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.

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SOURCE S&P Dow Jones Indices