Improving US dividend prospects
New data from Standard & Poor’s has shown improved prospects for dividend income in 2010 for the US domestic market.
Looking at the approximately 7,000 publicly owned companies that report dividend information to Standard & Poor’s, only 48 of these reduced their dividend payment during the first quarter of 2010.
This is a dramatic improvement when compared to the record 367 companies that lowered their dividend payment in the first quarter of 2009.
The forward net change in the indicated dividend rate for the first quarter was a positive $6.4 billion. This compares quite well to the $43.8 billion in reductions recorded in first quarter of 2009.
This research demonstrates a return to confidence for the directors of US publicly owned companies. It sends a clear signal that the prospects for both economic recovery and future earnings ability is strong in 2010.
Whilst this is only one measure to consider, it should inform investors when they are considering their tactical positions.