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NEW YORK, Jan. 6, 2021 /PRNewswire/ — S&P Dow Jones Indices announced today that indicated dividend net changes (increases less decreases) for U.S. domestic common stocks increased $9.5 billionduring Q4 2020, compared to a decline of $2.3 billion in Q3 2020, and a gain of $10.6 billion in Q4 2019.

For Q4 2020, aggregate increases amounted to $13.9 billion, up 64.2% from the $8.4 billion increase of Q3 2020 and up 15.7%, from Q4 2019’s $12.0 billion. Aggregate dividend cuts decreased 59.8% to $4.3 billion from Q3 2020’s $10.8 billion in cuts, and was up 221% from the $1.3 billion in cuts for Q4 2019.

For 2020, the net dividend rate fell $40.5 billion, compared to a gain of $45.4 billion for 2019, as increases were $41.4 billion versus $56.6 billion, and decreases were $82.2 billion compared to $11.1 billion for 2019.  

“Many companies have stabilized their operations and sales and are returning cash flow to the dividend market,” said Howard Silverblatt, Senior Index Analyst at S&P Dow Jones Indices. Silverblatt continued, “some issues which had suspended their payments after the start of COVID, have resumed payments. The $13.9 billion in Q4 increases represented a 15.7% increase over the pre-COVID Q4 2019 period. For the year, the $82.2 billion in cuts and suspensions took their toll but now appear to have mostly abated as increases of $41.4 billion helped limit the damage. Looking ahead to 2021, absent a failure on the COVID treatment side, dividends should be impressive with the S&P 500 expected to post a new record payment.”

S&P 500 Dividends

On a per share basis, S&P 500 Q4 2020 dividend payments for the S&P 500 increased 4.8% to $14.64 from Q3 2020’s $13.97 and down 3.8% from Q4 2019’s $15.21 payment. On an aggregate basis, index components paid $121.6 billion in dividends in the quarter, up from $115.5 billion in Q3 2020 and down from $126.4 billion of Q4 2019.  For 2020, the index set a record payment of $58.28 per share, slightly up from the prior record of 2019’s $58.24, with an aggregate $483.2 billion to shareholders, compared to $485.5 billion.

Additional findings from S&P Dow Jones Indices’ quarterly analysis of U.S. dividend activity include:

Dividend Increases (defined as either an increase or initiation in dividend payments):

  • 620 dividend increases were reported during Q4 2020 compared to 686 during Q4 2019, a 9.6% year-over-year decline.
  • Total dividend increases were $13.9 billion for the period, up from $12.0 billion for Q4 2019.
  • For the full 2020 period, 1,901 issues increased their payments, the lowest since 2010, compared to 2,381 issues for the prior period, a 20.2% decrease.
  • Total dividend increases for 2020 were $41.4 billion for the year, down from $56.6 billion for 2019.

Dividend Decreases (defined as either a decrease or suspension in dividend payments):

  • 57 issues decreased dividends during Q4 2020, compared to 74 during Q4 2019, a 23.0% year-over-year decrease.
  • Dividend decreases were $4.3 billion for the period, down from $1.3 billion for Q4 2019.
  • For the full 2020 period, 932 issues decreased their dividend payments, compared to 338 decreases during the prior period, a 176% increase.
  • Dividend decreases were $82.2 billion for 2020, up from $11.1 billion for the prior period.

Non-S&P 500 domestic common issues (for issues yielding 10% or less):

  • The percentage of non-S&P 500 domestic dividend-paying common issues decreased to 22.8% in Q4 2020, down from 23.4% in Q3 2020, and down from 28.0% in Q4 2019.
  • The weighted indicate dividend yield for paying issues was 2.58% in Q4 2020, down from 2.76% in Q3 2020, and down from 3.30% for Q4 2019. The average indicated yield decreased to 2.98% for Q4 2020, down from Q3 2020’s 3.29%, and matching the 2.98% for Q4 2019.

Large-, Mid-, and Small-Cap Dividends:

  • 385 issues, or 76.2%, within the S&P 500 currently pay a dividend, up from 383 in Q3 2020, as 27 of the 30 members of the Dow Jones Industrial Average® pay a dividend.
  • 60.0% of S&P MidCap 400®issues now pay a dividend, up from 59.0% for Q3 2020; 46.9% of S&P SmallCap 600®issues pay a dividend, up from 45.4% in Q3 2020. 
  • Yields across market-cap sizes decreased from Q3 2020, as prices continued to set record highs. Large-cap yields decreased to 1.51% (1.68% for Q3 2020 and 1.86% for Q4 2019), mid-caps to 1.27% (1.55% for Q3 2020 and 1.68% for Q4 2019), and small-caps to 1.19% (1.47% for Q3 2020 and 1.56% for Q4 2019).
  • The yields across dividend-paying market-size classifications were closer, but varied, with large-caps down to 2.06% (2.26% for Q3 2020 and 2.28 for Q4 2019), mid-caps at 2.20% (2.63% for Q3 2020 and 2.38% for Q4 2019) and small-caps at 2.44% (2.97% for Q3 2020 and 2.64% for Q4 2019). 

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

ABOUT S&P DOW JONES INDICES

S&P Dow Jones Indices is the largest global resource for essential index-based concepts, data and research, and home to iconic financial market indicators, such as the S&P 500® and the Dow Jones Industrial Average®. More assets are invested in products based on our indices than products based on indices from any other provider in the world. Since Charles Dow invented the first index in 1884, S&P DJI has been innovating and developing indices across the spectrum of asset classes helping to define the way investors measure and trade the markets.

S&P Dow Jones Indices is a division of S&P Global (NYSE: SPGI), which provides essential intelligence for individuals, companies, and governments to make decisions with confidence. For more information, visit: www.spdji.com.  

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SOURCE S&P Dow Jones Indices