Finance 0

Dividends By The Numbers In February 2018

By Kurt Osterberg · On March 6, 2018

When it comes to the number of dividend increases declared during a single month, the U.S. stock market just recorded its best February ever.

As an important caveat, “best February ever” refers to a data series that only extends back to January 2004, where there are only 15 Februaries to consider.

Still, what makes the month more remarkable is that it also posted the third highest monthly total of declared dividend raises that have been recorded in the 170 months for which we do have this kind of data!

Let’s get to the dividend numbers for February 2018:

3,493 U.S. firms declared dividends during the shortest month of 2018, up from the 2,734 that did in January 2018 and also up from the 3,359 that declared dividends a year earlier in February 2017.

38 companies announced that they would pay an extra, or special, dividend payment to their shareholders in February 2018, down from 51 last month, but up from the 35 that did in the same month a year ago.

We’ve touched on February 2018 being a record setting month already, but to put numbers to it, there were 322 U.S. companies that announced that they would increase their dividends, which is up from the 318 that boosted their dividends in January 2018 and up significantly from the 287 that hiked their dividends back in February 2017.

The number of U.S. firms announcing that they would be reducing their dividends dropped to 20 in February 2018, which is down from the 36 dividend cuts declared a month earlier and also down from the 35 dividend cutters reported in February 2017.

There were 9 U.S. firms omitting to pay dividends for the month, which is up from the 1 firm that declined to pay dividends in Janaury 2018 and also up from the 4 companies that omitted paying dividends to their shareholders back in February 2017.

The increase in companies omitting their dividends is interesting, so we tapped the limited sample of dividend declarations recorded by Seeking Alpha and the Wall Street Journal for February to try to get more insight into what kinds of firms are passing on paying dividends to shareholders. We found just one report in the sample, for Frontier Communications (Nasdaq: FTR), who reported after the end of trading on Tuesday, 27 February 2018 that they would suspend paying their dividend to use the $250 million they would otherwise have paid out to reduce their corporate debt.