Dividend


Also found in: Dictionary, Thesaurus, Medical, Legal, Idioms, Encyclopedia, Wikipedia.
Related to Dividend: Dividend yield

Dividend

A portion of a company's profit paid to common and preferred shareholders. A stock selling for $20 a share with an annual dividend of $1 a share yields the investor 5%.

Dividend

A portion of a publicly-traded company or fund's earnings that is distributed to shareholders. The amount of earnings distributed as dividends is usually determined by the board of directors and divided by the number of shares, but preferred stock often has guaranteed dividends. Dividends exist in order to encourage investment in the company and to allow shareholders (who are really co-owners) to participate in the profits. A rapidly expanding company often pays little or nothing in dividends, as most of its earnings are reinvested in the company. On the other hand, a well-established company with solid profits likely pays relatively high dividends.

dividend

A share of a company's net profits distributed by the company to a class of its stockholders. The dividend is paid in a fixed amount for each share of stock held. Although most companies make quarterly payments in cash (checks), dividends also may be in the form of property, scrip, or stock. Unlike interest on a debt, dividends must be voted on by the company's directors before each payment. See also bond dividend, capital dividend, cash dividend, consent dividend, constructive dividend, declaration date, declared dividend, ex-dividend date, final dividend, illegal dividend, interim dividend, liability dividend, liquidating dividend, optional dividend, stock dividend.

Dividend.

Corporations may pay part of their earnings as dividends to you and other shareholders as a return on your investment. These dividends, which are often declared quarterly, are usually in the form of cash, but may be paid as additional shares or scrip.

You may be able to reinvest cash dividends automatically to buy additional shares if the corporation offers a dividend reinvestment program (DRIP).

Dividends are taxable unless you own the investment through a tax-deferred account, such as an employer sponsored retirement plan or individual retirement account. That applies whether you reinvest them or not.

However, dividends on most US and many international stocks are considered qualifying dividends. That means you owe tax at your long-term capital gains rate, provided you have owned the stocks the required length of time.

Dividends on real estate investment trusts (REITs), mutual savings banks, and certain other investments aren't considered qualifying and are taxed at your regular rate.

dividend

a payment made by a JOINT-STOCK COMPANY to its SHAREHOLDERS for providing SHARE CAPITAL. Dividends are a distribution of the after-tax PROFITS of the company, and are paid in proportion to the number of shares held. Generally the directors of a company will decide to pay out only a proportion of after-tax profit as dividends, reinvesting the remaining profits in the business (see RETAINED PROFIT).

The DIRECTORS may pay an interim dividend during the accounting period then recommend a final rate of dividend per share for approval by shareholders at the ANNUAL GENERAL MEETING, this final dividend being paid after the AGM. In the UK dividends are paid net of income tax, though shareholders receive a tax credit for the amount of tax deducted by the company from their dividends, which must be added to the net dividends received to establish the shareholder's gross taxable dividend income (see CORPORATION TAX).

dividend

a payment made by a JOINT-STOCK COMPANY to its SHAREHOLDERS for providing SHARE CAPITAL. Dividends are a distribution of the PROFITS of the company

Dividend

A stockholder's share of the profits of a corporation. An insurance dividend is not a true dividend but a return of premium. Dividends from a savings and loan association or credit union are interest, not dividends.
References in periodicals archive ?
Firms of non-financial sectors of Pakistan are confronted with the issue of whether to pay a significant, little or zero rate of their earning as a dividend or retain their earning for future financing ventures.
Finally, the company will have paid USD21.96 per share in cumulative dividends since its October 2007 initial public offering at USD15.00 per share, which includes all dividends declared to date,it said.
Hilde Gronland, company secretary, has been allocated 21 Dividend Shares in the Dividend Issue.
All that dividend income -- combined with historic lows in U.S.
901(1)(1)'s general rule that denies a foreign tax credit (FTC) for withholding taxes imposed on an item of income (other than dividends) or gain, when the underlying property generating the income or gain is held for a relatively short period.
Thus, the principal benefit of the lists of permitted and non-permitted investments is to reassure taxpayers that their dividend investment plans will not be challenged on audit by the IRS as long as all funds described in those plans are allocated to explicitly permitted uses.
The Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA) reduced the individual tax rate on corporate dividends received to 15% for individuals in the 25%, 28%, 33% and 35% tax brackets (5% (0% in 2008) for individuals in the 15% and 10% income tax brackets); this affords some planning strategies for closely held corporations that want to reduce their accumulated earnings and profits (E&P).
But what if a particular group of shareholders has a strong preference for cash in the pocket rather than the company vault--say, as a source of income--would dividend policy matter then?
The rationale for maintaining both the TPS rules and the taxable preferred share rules was a concern that financial institutions would build a portfolio of preferred shares that were really disguised loans in order to avail themselves of the $500,000 dividend allowance for taxable preferred shares.
surprised shareholders, analysts, and other industry vendors with a late Christmas gift: dividends. Redmond announced that shareholders of record February 21 will receive a dividend of--hold on to your hat--eight cents per share on March 7.
But, in reality, many corporations continue to consider the dividend to be an essential component of shareholder return.