Subject: A Dividend of Confidence

Dividend-paying stock and a company’s cash position.

A Dividend of Confidence

Dividend-paying stock and a company's cash position.

  The most recent stats on cooperate dividends against that global companies are bullish on the word's economic recovery.



Dividends paid to investors are on track to hit $1.4 trillion this year and are expected to stretch even higher in the next 12 months. New research found that 84% of companies in the second quarter either increased or maintained their dividend compared to last year.1


Although the current environment looks positive, dividends can be stopped or decreased at any time. If a company has financial difficulties, its board of directors may elect to reduce or eliminate its dividend for a period of time.2

  

If you have your eye on a dividend-paying stock, you may want to take a look at the company’s cash position. Companies with a strong cash position might be able to pay their scheduled dividend without interruption.


Some mature, profitable companies have a track record of paying regular dividends to shareholders. But past performance can’t guarantee future payouts.


Evaluating a company’s cash position can be difficult, so contacting a professional who has experience reviewing a company’s financial statements may be helpful.

     


Citations.


1. CNBC.com, August 23, 2021

2. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. The S&P 500 Composite Index is an unmanaged group of securities considered to be representative of the stock market in general. Index performance is not indicative of the past performance of a particular investment. Past performance does not guarantee future results. Individuals cannot invest directly in an index.