Special Dividends Now Well Over $20 Billion ... Much More to Come
The rate of special dividends from large great American companies is coming at an alarming rate. If the politicos in Washington D.C. are not paying attention to this about how taxes will adjust behavior and decisions beyond 2013, then they are truly that much more inept than they seem today in their Fiscal Cliff negotiations. This is a direct and open attempt to get the cash back to shareholders before the 15% taxes go up to 23.8% or way up over 40% on the high-earners. CNBC tallied this figure up above $21 billion as of Friday and this is still just the last day of November. Here is just a partial list of our top one-time special dividends and accelerated dividends coming before the end of 2012.
AOL Inc. (NYSE: AOL) had made its plans known long before others, but this will be a $5.15 one-time payout on December 14 to holders of record as of December 5. This $1.1 billion will be considered a return of capital for tax purposes.
Brown-Forman Corporation (NYSE: BF-B) is paying a special dividend of $4.00 per share. The company’s normal dividend has been only $1.40 per share per year.
Costco Wholesale Corp. (NASDAQ: COST) is paying out a special dividend of $7.00 per share, which is massive considering it only yields about 1% in regular dividends.
Dillard’s (NYSE: DDS) went out with a special dividend of $5.00 per share. When you consider that its quarterly payout is only $0.05 per share this massive.
Enzon Pharmaceuticals Inc. (NASDAQ: ENZN) does not normally pay a dividend so this was a surprise. It is sending back a special $2.00 per share dividend to holders. Even after an 8% gain, this is only a $7.00 stock.
Guess? INc. (NYSE: GES) announced a special dividend of $1.20 per share to be paid by the end of December. This is 150% of a normal year’s payout of $0.80 per share.
Hi-Tech Pharmacal Co. (NASDAQ: HITK) does not normally have a dividend, so this one was a bit of a surprise. Still, it is sending holders a special $1.50 dividend and its shares are just under $30 now.
H.J. Heinz Co. (NYSE: HNZ) declared that it would expedite payment of its $0.515 common dividend ahead of the fiscal cliff.
Las Vegas Sands (NYSE: LVS) is sending $2.75 per share back to holders, which is about 3-times its normal 2% dividend yield.
National Beverage Corp. (NASDAQ: FIZZ) is paying out a special $2.55 dividend to shareholders.
Regal Entertainment Group (NYSE: RGC) already has a high dividend payout, but it is sending out an extra $1.00 per share versus close to a $15 share price.
Tellabs (NASDAQ: TLAB) announced a special $1.00 dividend, which is returning 34% of the value of the company considering that it was a $2.95 stock yesterday before the post-news pop.
The Walt Disney Company (NYSE: DIS) hiked its annual cash dividend to $0.75 per share, up 25% from the prior dividend. While this is a normal dividend, it is payable on December 28, 2012 to shareholders of record at the close of business on December 10, 2012. Disney historically declares its dividend in the late November or early December period but it does not usually mail those checks out until January.
Westlake Chemical (NYSE: WLK) is sending a $3.75 dividend back to holders, about 5-times its normal annual payout and normal yield of about 1%.
Wynn Resorts Ltd. (NASDAQ: WYNN) may have doubled its dividend, but the casino and hotel operator is also issuing a an $8.00 special dividend.
We have compiled a list of the large tech giants which we expect to see a one-time special dividend from before the end of 2012. With Microsoft Corporation (NASDAQ: MSFT) holding an investor event in the coming week, they are one of our most likely candidates.
JON C. OGG