S&P Indices said Wednesday that more companies increased their dividends in 2011 compared with a year earlier, a trend expected to continue into 2012.
Dividend increases reached $50.2 billion in 2011, an 89.2 percent rise over the $26.5 billion posted in 2010. A total of 1,953 issues increased their dividends, which is a 13 percent jump over the 1,729 dividend increases reported in 2010, according to S&P.
For 2012, we expect to see dividend increases continue across the board for all sectors with another double-digit gain in actual cash payments, Howard Silverblatt, senior index analyst at S&P Indices, wrote in the report.
Given underlying fundamentals, low payouts and cash reserves, we expect 2012 to set a new record for dividends despite lingering concerns over the economy, he noted.
Additionally, Silverblatt reports that individual investors have saved $314 billion on qualified dividend tax cuts from 2003 through 2011, with another $44 billion in savings expected in 2012 before the legislation expires.
As Washington works through revenue requirements and expenditures, the post-2012 tax outlook treatment for dividends is very much in play, Silverblatt said.