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Dividend Payout Could Hit Record Amount This Year
10 Feb 2012 EST -
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February is the busiest month for dividend declarations and increases, and this year, the biggest U.S. corporations may pay out a record amount, making up for some of the cash they withheld from shareholders during the financial crisis and earlier stages of the recovery.

The dividend rate, or the payout rate of the S&P 500 companies, hit an all-time high in June 2008, but it fell sharply by August 2009.

It is now up 31.8 percent since then, but still lags the 2008 level by about 2.5 percent, according to Standard and Poor’s data.

For all of last year, S&P 500 companies paid out a total $241 billion, versus the $247.9 billion they gave shareholders in 2008. The payout rate fell to a trough of $196 billion in 2009, as companies increasingly hoarded record amounts of cash.

“I expect the index will retake that high later this year and hit a new record,” notes Howard Silverblatt, senior index analyst for Standard and Poor’s indexes. “I’m looking for $263 billion by the time this year is over.”

Bespoke Investment Group co-founder Paul Hickey said already this year, there seems to be an increase in dividend raises already.

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