I was interviewed for this article a couple weeks earlier, and some of what I said was used in the article. My thoughts were used as a voice of optimism:
It's too early to tell which firms will emerge from the economy on top, according to David Van Knapp, a private investor who focuses on dividend investing. But he added that companies with healthy balance sheets, good cash flow, and a standing tradition of boosting dividends are usually good bets. "Distributing and raising dividends is part of the culture at many companies, a practice embedded over decades. Only the most dire circumstances will cause such companies to cut their dividends," he said. "Despite the recession and economic situation, not all companies are in those dire circumstances - yet."The article included statistics from Standard & Poor's, which tracks dividends for its S&P 500's stocks. S&P estimates that dividend payments will fall by 23% this year, marking the largest decline since a 36% slide in 1938. It also quoted an analyst from Morningstar who said, "People getting this are getting a pay cut."
Those of you who have read my books or articles about dividend investing know that I am generally optimistic about dividends from the best dividend companies. For that reason, I find the statistics from S&P about the decline in total dividends paid by all 500 companies to be interesting but only marginally useful. The vast majority of the dividend cuts have come (and will continue to come) from banks and other financial firms, for pretty obvious reasons. Only two banks made it onto my TOP 40 DIVIDEND STOCKS FOR 2009 list. One of those is Canadian, and neither is in the S&P 500. So the fact that big banks are cutting dividends is not relevant to the dividend investor who is not invested in them.
Several of the companies which made it onto my Top 40 list have already raised their dividends for 2009.
If you want to read the full CNNMoney.com article, it is posted here: http://money.cnn.com/2009/03/20/markets/dividend_caution/index.htm
If you want to learn more about THE TOP 40 DIVIDEND STOCKS FOR 2009, click here.
