Unexpectedly Intriguing!
December 3, 2014

Want to see something pretty incredible? The chart below shows all the data we have for the number of public U.S. companies that have either increased or decreased their cash dividends since January 2004. Take a close look at the number of companies that Standard and Poor has initially recorded as having increased their dividends during the month of November 2014 and compare it with all the figures that have previously been reported.

Number of Public U.S. Companies Increasing (Blue) or Decreasing (Red) Their Dividends, January 2004 through November 2014

Assuming this number will not dramatically revised downward, it would mean that 1,773 of the 2,979 declarations that U.S. companies made about their dividend payments in November 2014 involved increasing them. And yet, the amount of dividends that these companies are expected to pay in the future didn't increase all that much during November 2014!

That 1,773 figure would nearly five times larger than the previous record of 368 companies that declared they would increase their dividends back in January 2014.

That number was interesting enough that we dug deeper, tapping the Wayback Machine's archive of the data the Wall Street Journal's posts regarding the declarations that U.S. companies make on a daily basis. Although a week of data is missing from the beginning of the month, none of the data that was recorded suggests that anywhere near that many companies increased their dividends during the month, so we would anticipate that this figure will be corrected by S&P at some point in the future.

Update 2:30 PM EST: S&P's Howard Silverblatt moved fast to fix what turned out to be a typo - the actual number of U.S. companies increasing their dividends in November 2014 is 173! Our updated chart is below:

Number of Public U.S. Companies Increasing (Blue) or Decreasing (Red) Their Dividends, January 2004 through November 2014 - UPDATED BY S&P

Meanwhile, we find that the number of companies that declared they would be decreasing their dividends increased slightly during the month.

Monthly Number of Public U.S. Companies Announcing Dividend Cuts, 
January 2004 through November 2014

At 17 companies, we find this figure is consistent with recessionary conditions being present in the U.S. economy, and more specifically, with what we describe as a microrecession. A microrecession represents the situation where recessionary conditions are present in the U.S. economy, but which are too limited in scope, severity or duration to be considered to be a full blown recession as defined by the National Bureau of Economic Research, the official arbiters of whether the U.S. economy is expanding or contracting.

Since we already went to the trouble of reviewing the archive of dividend declaration for the month of November 2014, we do have some insight into which companies are decreasing their dividends. We found that a number of oil industry-related firms cut their dividends during the month, which is perhaps the first confirmation we have that falling oil prices are negatively impacting that industry in the U.S. We counted nine such companies in the available archived data for the month.

If not for those particular dividend cuts, the number of companies cutting their dividends in November 2014 would have fallen below our identified recession line, indicating that much of the rest of the U.S. economy was comparatively healthy during the month, which might be expected since falling oil and fuel prices is a positive factor for other parts of the U.S. economy. Thus far then, the negative impact of these particular recessionary conditions for U.S. businesses is limited in its scope.

Data Source

Standard & Poor. Monthly Dividend Action Report. [Excel Spreadsheet]. Accessed 1 December 2014.

Labels: , ,

About Political Calculations



blog advertising
is good for you

Welcome to the blogosphere's toolchest! Here, unlike other blogs dedicated to analyzing current events, we create easy-to-use, simple tools to do the math related to them so you can get in on the action too! If you would like to learn more about these tools, or if you would like to contribute ideas to develop for this blog, please e-mail us at:

ironman at politicalcalculations.com

Thanks in advance!

Recent Posts

Applications

This year, we'll be experimenting with a number of apps to bring more of a current events focus to Political Calculations - we're test driving the app(s) below!

Most Popular Posts
Quick Index

Site Data

This site is primarily powered by:

This page is powered by Blogger. Isn't yours?

Visitors since December 6, 2004:

CSS Validation

Valid CSS!

RSS Site Feed

AddThis Feed Button

JavaScript

The tools on this site are built using JavaScript. If you would like to learn more, one of the best free resources on the web is available at W3Schools.com.

Other Cool Resources

Blog Roll

Market Links
Charities We Support
Recommended Reading
Recommended Viewing
Recently Shopped

Seeking Alpha Certified

Archives
Legal Disclaimer

Materials on this website are published by Political Calculations to provide visitors with free information and insights regarding the incentives created by the laws and policies described. However, this website is not designed for the purpose of providing legal, medical or financial advice to individuals. Visitors should not rely upon information on this website as a substitute for personal legal, medical or financial advice. While we make every effort to provide accurate website information, laws can change and inaccuracies happen despite our best efforts. If you have an individual problem, you should seek advice from a licensed professional in your state, i.e., by a competent authority with specialized knowledge who can apply it to the particular circumstances of your case.