Financial Accounting Blog

Tuesday, December 16, 2003

Culpepper e-bulletin says that the number of public technology companies paying dividends has nearly doubled in the past year.
No doubt, the current dividend trend will continue in 2004. More tech companies will pay dividends, and their dividends will grow. This move to offer greater dividends may be enhanced by the desire of some founders for greater personal liquidity and diversification while minimizing their sale of stock. Of course, only modest diversification can occur via dividends as long as stock prices remain high and payouts low. Nonetheless, dividend payments will please many rank-and-file shareholders. Not only will they receive a cash return, they will not be troubled by as much insider selling.