Updated from 4:30 pm. ET to include list of top ten dividend payers in the S&P 500 by current yield, information about the increase in the index's overall yield.
NEW YORK (
) -- Nearly 80% of the companies in the
paid dividends at the end of the fourth quarter, according to
, which said Friday that the total of 393 companies is the highest level since the fourth quarter of 1999.
"While the index consistently had greater than 400 dividend-paying companies (or more than 80% of constituents) -- during the 1990's, the 80% milestone has not been breached since the turn of the century," the firm said. "The recent low for the number of trailing twelve month (TTM) dividend-payers was 368 in January 2010. Since that time, dividend-paying companies have grown organically (there has been a net loss of three dividend-paying companies from the thirty-seven constituent changes in the S&P 500 over the two-year period)."
recently unveiled its plan to join the ranks of dividend payers, announcing on Monday that it expects to initiate a quarterly payout of $2.65 per share "sometime in the fourth quarter of its fiscal 2012."
Fittingly, given Apple's announcement, FactSet said companies in the information technology sector have embraced returning money to shareholders in the past decade.
"Ten years ago (July 2002), just 17.9% of Information Technology companies in the S&P 500 paid a dividend in the trailing twelve months," the firm said. "However, Q3 2011 marked the first quarter in the S&P 500 in which there were more dividend-paying stocks in the Information Technology sector than non-dividend-paying ones. And, at the end of Q4 2011, dividend-paying stocks in the sector held the strongest majority in over twenty years -- 53.5% of S&P 500 Information Technology stocks paid a dividend over the trailing twelve months."
In further sector analysis, FactSet said telecommunication services companies have been lagging in increasing their payouts with only
"This general reluctance of companies in the Telecom Services sector to increase dividends could be a product of weak earnings," the firm said. "Four of the seven constituents in the Telecom Services sector reported losses for Q4 2011. Overall, the sector reported a loss of -$9.7 billion in the quarter and a profit of only $4.8 billion over the trailing twelve months. This trailing twelve month earnings figure is just over a fourth of the value of trailing twelve month earnings at the end of Q3 2011 ($17.7 billion)."
Another observation of FactSet's analysis is that the financial sector is the only sector in the S&P 500 that paid less in gross TTM
trailing twelve months dividends most recently than it has in the past 10 years. The onset of the financial crisis saw many banks forced to lower or eliminate their payouts, and the federal government has oversight over the dividend plans of institutions deemed to be systemic importance.
For example, in the wake of the results of the
stress tests earlier this month, Dow component
was able to boost its quarterly dividend to 30 cents a share, an increase of 5 cents, or 20%, while
was put in the penalty box by the central bank, which denied Citi's request to return capital to shareholders.
FactSet said the financial sector's TTM cash outflows from dividends are 30% below their 10-year average.
"The reduced dividend payout in the Financials sector is partly attributable to poor performance and stricter capital requirements in the sector," the firm said. "As a result, some of the largest pre-crisis dividend-payers are distributing just a fraction of their 2008 payout in 2011. In 2011,
Bank of America
paid only 15.1% of the pre-crisis $11.5 billion payout from 2008, Citigroup only 1.4% of its $7.5 billion, and
only 12.6% of its $1.0 billion."
Elsewhere in its quarterly review of the world of dividends, FactSet said the S&P 500's aggregate yield stood at 2% at the end of the quarter. That's in line with the ten-year daily average but up 12.9% year-over-year.
The top ten dividend payers in the index by current yield are
at 5.0%; and
Written by Michael Baron in New York.
>To contact the writer of this article, click here:
Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.