Ticonderoga Securities analyst Neil Herman points out in a research note this morning that the software giant has a history of increased its payout in September. He thinks the company “should and will” do the same thing following an upcoming September board meeting. Herman’s view is that the company should match the payout ratios of peers – a move that he says would involve more than doubling the current rate of 64 cents a share. The stock currently yields 2.5%. “We believe that a large dividend increase would be a major catalyst for the stock, particularly in these uncertain times,” he writes.
Herman explains that he compared the company’s operating cash flow and free cash flow to the company’s 12 largest dividend paying peers, and the net income payout of the 171 largest dividend paying companies. He writes, “If Microsoft were to match it peers on payout ratios, it would equate to a dividend yield increase to 6.0% from the current [2.5%], and include an approximate doubling of the company’s dividend. By doubling its dividend, Microsoft’s payout ratio would be close to the average of other large-cap companies.
Source: Forbes
Related Articles:
- Increasing Dividend Yield Part VI: Time
- Increasing Dividend Yield Part V: MLPs
- Increasing Dividend Yield Part IV: Bonds
- Increasing Dividend Yield Part III: Preferred Stock
- Increasing Dividend Yield Part II: REITs
Is It Time For Microsoft To Double Its Dividend
Posted by D4L | Wednesday, August 31, 2011 | ArticleLinks | 0 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
~
Popular Posts Last 30 Days
-
Dividends and diversification -- those two things can help you achieve a comfortable retirement when combined with the income you will recei...
-
As a relatively new blogger, the one thing that has stood out in my mind is the number of Canadian bloggers in the areas that I am most inte...
-
The best dividend stocks have one thing in common: resiliency. They can continue increasing their dividends even in the harshest economic en...
-
Investors wanting to enjoy steady and consistent income should consider dividend aristocrats. In fact, even in these chaotic times, dividend...
-
A good dividend stock has more than a high yield. Dividends need to be supported by cash flow, and cash flow depends on the long-term streng...
-
Higher dividend yields often imply that the underlying company paying the dividend has a higher risk profile. However, that's not always...
-
When hunting for discounted investments, one excellent starting point is to look for businesses with dividend yields trading above their fiv...
-
It's hard to beat a sustainable, high-yield dividend paired with a beaten-down valuation. The best dividend stocks offer high yields and...
-
Strange but true: seniors fear death less than running out of money in retirement. And unfortunately, even retirees who have built a nest eg...
-
BDCs can be excellent investment options for those seeking high returns, particularly when acquired at favorable valuations and supported by...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.