List of Dividend Paying Shares

Thrugelmir

redbuzzard wrote: »

Apple's share price has undoubtedly been constrained to some extent by its massive cash hoard for fear it would make a bad acquisition and destroy its value.

Apple's problem is that the cash sits "offshore". To repatriate profit back to the USA would incur a large tax charge.

Hence it's cheaper to borrow in the USA to fund the dividend payout, while the interest remains tax deductible.

The impact of the clamp down globally on Corporate tax policy may hurt many large company shares in the future.

CLAPTON

A_Flock_Of_Sheep wrote: »

The tax on Dividends for me I think is less than on savings %. 10% dividends and 20% on savings.

bizzare


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grey_gym_sock

cepheus wrote: »

Is buying a share with a high dividend theoretically inefficient for the individual investor, because you can't reclaim all all the tax, even if held in an ISA?

If profits were reinvested in the company instead (rather than paid out as dividends) the capital should be reflected in the price and subsequent potential capital gain, which in many circumstances would not be subject to tax.

in an ISA (or for a basic-rate taxpayer who doesn't go over the annual CGT allowance), there is no difference in the taxation of profits which are paid out as dividends vs profits which are retained by the company. because the company don't actually pay anything for the 10% tax credit. all they pay is corporation tax, which is a % of the total profits made by the company, regardless of how much is paid out.

the 10% tax credit is pretty bizarre, in that it's neither actually paid by the company, nor reclaimable by the shareholder (even when they're a non-taxpayer).

for higher-rate (or additional rate) taxpayers, dividends are usually less tax-efficient than retained earnings.

cepheus

grey_gym_sock wrote: »

in an ISA (or for a basic-rate taxpayer who doesn't go over the annual CGT allowance), there is no difference in the taxation of profits which are paid out as dividends vs profits which are retained by the company. because the company don't actually pay anything for the 10% tax credit. all they pay is corporation tax, which is a % of the total profits made by the company, regardless of how much is paid out.

the 10% tax credit is pretty bizarre, in that it's neither actually paid by the company, nor reclaimable by the shareholder (even when they're a non-taxpayer).

for higher-rate (or additional rate) taxpayers, dividends are usually less tax-efficient than retained earnings.

We still receive less than the headline rate of dividend though. However, for ISA and low rate taxpayers, are you saying the 10% tax is effectively irrelevant?

Presumably companies simply (could) simply increase their dividend by 10% to make up for the 'loss' to the investor, which is equivalent to the dividend not being taxed at all?

How much do share prices drop to allow for the dividend, 90% of the headline rate on average? Surely someone has worked this out. If not it should be possible to profit by buying shares just before the x dividend date than reselling.

CKhalvashi

cepheus wrote: »

How much do share prices drop to allow for the dividend, 90% of the headline rate on average? Surely someone has worked this out. If not it should be possible to profit by buying shares just before the x dividend date than reselling.

It's more about share prices dropping, and just remember that the company can stop the dividend at any time (we're planning not to issue for 2014/15 and 2015/16), which whilst it will be in the long term interests of the shareholders, dividends are certainly not bulletproof for an investment decision.

CK

Glen_Clark

Earnings figures are all very well, but can be massaged and the Directors have a big incen tive to do so because it affects their bonuses. They can inflate the value of assets, then write them down later as 'exceptional items'
Dividend figures (yield) cannot be massaged.

redbuzzard

Glen_Clark wrote: »

Dividend figures (yield) cannot be massaged.

Up to a point, Lord Copper.

Flat dividends in money terms can point to a declining situation - the company doesn't want to cut the divi unless it has to, so pushes the figures to maintain earnings cover and maintain it - the corollary is that they will avoid booking bad news if they can, and will have emptied every drawer and cupboard for anything they have squirrelled away or overlooked in previous years to maximise the reported profit.

There's no one indicator of a solid dividend but lots of things add up to a picture. Look at the cash flow, bearing in mind it's a function of investment as well as op costs and revenues.

Of course what you can't see in the accounts is unreported events after the last filing. Always check news, regulatory announcements, and read trading statements carefully and between the lines - what's missing, or fudged? Those statements aren't statutory in format so they are easiest to massage - a bit like fund performance in brochures!

Ark_Welder

redbuzzard wrote: »

If the OP wishes to buy shares with dividend income attached, one of a number of possibilities that might reasonably be inferred, an equity income fund is a reasonable suggestion.

It's no good just buying shares with a high listed dividend yield, as we all know some are absolute dogs and it's not the numerator that's high, it's the denominator that's dropped thought the floor.

So an income seeker can either do the research themselves, or let someone else do it and buy a fund. To qualify as "equity income", IIRC, the yield must be>= 110% x the FTSE.

However, it is one thing to make assumptions about an individual's intentions, but quite another to provide answers based upon those assumptions, which may have no bearing on the reason for the question being asked.

The OP may very well be intending to buy high-yielding shares rather than shares with a yield - that is what I assumed, and is also is the specific reason why I did not sort the lists of companies and their yields into order before providing the links. But it is the links that, hopefully, answer their question. Whereas suggesting that they do something that is based on an assumption, may not.

Let's try and answer what is being asked rather than giving answers to what has not been asked.

sabretoothtigger

I have Spanish stocks that yield over 10%.
Telefonica suspended their div this year, so no yield but it could be the right move to spend elsewhere and market didnt sell it really

grey_gym_sock

cepheus wrote: »

We still receive less than the headline rate of dividend though.

which headline?

when a company declares a dividend of (say) 9p per share, that means that 9p is what they actually pay. (i.e. the 10% "tax credit", which comes to 1p, is on top of that.)

when the yield of a share is quoted, e.g. 4% yield, that's also based on the actual payout, excluding the tax credit.

However, for ISA and low rate taxpayers, are you saying the 10% tax is effectively irrelevant?

yup.

Presumably companies simply (could) simply increase their dividend by 10% to make up for the 'loss' to the investor, which is equivalent to the dividend not being taxed at all?

well, in effect they do ... or, if you look at it another way, there's no loss to make up.

e.g. suppose a company makes £100m profit, and pays £20m corporation tax on that (corporation tax is more than 20% now, but will soon be cut to 20%), leaving £80m.

suppose they want to pay all of that out as dividends. there are 800m shares in the company, so they declare a dividend of 10p per share. the dividend comes with a 10% tax credit, of 1.111p per share (because 1.111p is 10% of the total of 10p + 1.111p = 11.111p).

shareholders receive total dividends of £80m in cash, plus non-reclaimable tax credits of £8.88m. the dividend cost the company £80m in cash. where is the loss?

How much do share prices drop to allow for the dividend, 90% of the headline rate on average? Surely someone has worked this out. If not it should be possible to profit by buying shares just before the x dividend date than reselling.

i think they tend to drop by roughly the cash amount of the dividend. though share prices tend to bounce around so much that it's difficult to separate this out form other effects.