Visa was one of Braden Dennis’ favorite companies, and he discussed how he likes to discover companies with high ROIC, which is actually a measure of how well the company’s management is doing (V).
Honestly, I’m a big fan of Visa, and I consider them my “favorite buy and own for eternity” company because of their strong ROIC and dividends.
They could have invested more and grown the business more quickly, right? So why are they handing out dividends if they’re efficient consumers of investment capital?
In terms of dividends, those are the two things I keep going back and forth on in my mind, and I know it might seem like I didn’t mention Apple at all, but believe me – you’ll get where I’m going with it.
When it comes to Apple’s dividends, as I’ve already indicated, how has the dividend’s history looked through time?
Compared to other companies I’ve studied, like JNJ and MMM, Apple has a strange history.
Apple, on the other hand, is not a dividend-paying company in the truest sense of the term.
Between 1987 and 1995, Apple paid a fairly regular dividend to shareholders, but after that, the company went on a hiatus, only to resume dividend payments in 2012 and continue them to this day, in September 2021, with the most recent payment in August 2021 being $.22/share, or a yield of.58 percent.
If you’re wondering what happened, here are some answers:
Some people may not be aware of this, but Apple truly had some serious challenges to overcome when they first started out.
Because they were competing against the big dogs, they were severely short on funds.
Because Apple was a true disruptor (changing the market from CDs to MP3), it required a considerable amount of capital from the corporation, thus paying out a dividend was just not an option.
Another reason why you’ll commonly see these tech companies acquire rather than expand organically is because they need to grow in a specific way.
If a competitor is doing a terrific job in an area that may benefit your company, it may be more cost-effective and efficient to acquire them.
Just buying the company will allow you to quickly benefit from the synergies that have been built up over time, rather than spending years and years attempting to catch up.
In other words, Steve Jobs wanted to keep a little money in the bank.
When it comes to purchasing a piece of the jigsaw to create something “large and bold,” he stated, “We know if we need to buy something, a piece of the puzzle, to produce something big and bold, we can write a check for it.” It provides us with a lot of protection and flexibility because of the money in the bank.”
For additional context on why a corporation might want to hang onto that cash, I found a really interesting Q&A from the International Business Times about Apple after they stopped paying its dividend in the 1990s and before they started paying it again.
There is a lot of information that you will miss out on if you only look at Apple’s Dividend History alone.
Here, you can see that the dividend is very steady until 1995, when it entirely goes down, and then picks back up in 2012::
How often does Apple stock pay dividends?
Do Apple Pay Dividends Frequently? A dividend payment is made four times a year for Apple investors, as is the case with other US-based dividend-paying corporations.
How much can you earn from Apple dividends?
From 1987 through 1995, Apple paid a dividend, which was discontinued in 1995. Apple resumed paying a dividend in 2012 and has subsequently increased it annually.
COVID has not deterred Apple from increasing its quarterly dividend by $0.05 ($0.20 annually). As of this writing, Apple’s dividend is nearly twice as high as it was in 2012.
In 2012, Apple relaunched its dividend program. As a result of the success of its iPod, iPhone and iPad, the business decided to resume its dividend program after 17 years of not paying out dividends to its shareholders.
A share repurchase program has also been launched. On an annual basis, Apple paid $2.5 billion to shareholders, making it one of the best dividend-paying companies in 2012. Shareholder dividends and stock repurchases totaled $45 billion, according to the corporation.
Apple now pays a dividend of $3.28 per year, which is divided into quarterly payments of $0.82. This equates to a dividend yield of 0.85 percent, which is in line with the industry standard for high-tech firms. In contrast, the S&P 500’s average dividend yield is less than 2%.
What dividend does Apple Pay Per share 2021?
Ex-dividend date is November 5, 2021 for pple Inc (AAPL). On November 11, 2021, shareholders will get a cash dividend of $0.22 per share. In order to receive the dividend payment, AAPL shareholders must have purchased the stock prior to the ex-dividend date. AAPL has paid the same dividend for the third quarter in a row. The dividend yield is.58 percent at the current stock price of $151.49.
How long do you have to hold Apple stock to get dividend?
For dividends to be taxed at the preferred 15% rate, you must hold the shares for a certain amount of time. A maximum of 61 days must pass before the ex-dividend date in order to meet this requirement.
Why is Apple dividend so low?
It’s because Apple’s new loan has a low interest rate. On the $2.5 billion of five-year notes, which bear a lower after-tax interest expense for Apple than the after-tax cost of the cash dividend that Apple pays its ordinary stockholders. Apple, on the other hand, is not able to deduct the dividend from its taxable income.
Is Apple a good dividend?
Increasing Dividends Apple paid a $0.68 annual dividend for the 2018 fiscal year. There was a $0.75 dividend for the year 2019, and there will be a $0.795 payout in 2020. From 2018 to 2019, the yearly dividend climbed by 10.3%, and from 2019 to 2020, the dividend grew by 10.6%.
Do Tesla pay dividends?
On our common stock, Tesla has never paid a dividend. We do not expect to pay any cash dividends in the near future because we plan to use all future earnings to fund future growth.
Are dividends paid monthly?
Although some corporations in the United States pay dividends monthly or semiannually, the majority pay quarterly. Each dividend must be approved by the board of directors of a corporation. The ex-dividend date, dividend amount, and payment date will then be announced by the corporation.
