Donate to Remove ads

Got a credit card? use our Credit Card & Finance Calculators

Thanks to johnstevens77,Bhoddhisatva,scotia,Anonymous,Cornytiv34, for Donating to support the site

FTSE100 to return 5.4% dividend + buybacks in 2022

General discussions about equity high-yield income strategies
vand
Lemon Slice
Posts: 758
Joined: January 5th, 2022, 9:00 am
Has thanked: 174 times
Been thanked: 350 times

FTSE100 to return 5.4% dividend + buybacks in 2022

#493409

Postby vand » April 10th, 2022, 7:15 pm

https://www.youinvest.co.uk/articles/in ... eturn-2022

3.9% dividend and an implied 1.5% in buybacks

The article notes that there seems to be a shift towards companies favouring buybacks - which doesn't suprise me at all.

"It appears that companies may be leaning more toward share buybacks when it comes to returning cash to shareholders. This could be down to a desire to preserve dividend cover at newly rebuilt levels, the UK Government’s one-and-a-quarter percentage point increase in dividend taxes, or the pensions’ regulator’s threat to challenge dividend payments made by firms with pension deficits, or a mixture of all three."

88V8
Lemon Half
Posts: 5769
Joined: November 4th, 2016, 11:22 am
Has thanked: 4098 times
Been thanked: 2560 times

Re: FTSE100 to return 5.4% dividend + buybacks in 2022

#493427

Postby 88V8 » April 10th, 2022, 8:03 pm

vand wrote:
"It appears that companies may be leaning more toward share buybacks when it comes to returning cash to shareholders. This could be down to a desire to preserve dividend cover at newly rebuilt levels, the UK Government’s one-and-a-quarter percentage point increase in dividend taxes, or the pensions’ regulator’s threat to challenge dividend payments made by firms with pension deficits, or a mixture of all three."

And nothing to do with improving eps, a factor in many executive reward programmes .... ;)

V8

Woadrage
Posts: 5
Joined: March 21st, 2022, 8:31 pm

Re: FTSE100 to return 5.4% dividend + buybacks in 2022

#495444

Postby Woadrage » April 20th, 2022, 5:57 pm

88V8 wrote:And nothing to do with improving eps, a factor in many executive reward programmes .... ;)

V8


That will undoubtedly be a factor for some companies, but I suspect general uncertainty will be driving a lot of hesitation to invest in some sectors. It may be that it makes sense to return capital to shareholders now rather than sit on it for a few years and then to capital raise later when things are clearer.

A company that was planning particular overseas investments or expansion, for example. A mining company that was planning to invest in Russia won't now go ahead, or one thinking of doing so in China might decide to hold fire for the time being.

On the other hand, sectors such as international logistics may have found opportunities during the pandemic and be actively investing in them so much less inclined to return capital.

Dod101
The full Lemon
Posts: 16629
Joined: October 10th, 2017, 11:33 am
Has thanked: 4343 times
Been thanked: 7534 times

Re: FTSE100 to return 5.4% dividend + buybacks in 2022

#495456

Postby Dod101 » April 20th, 2022, 7:48 pm

88V8 wrote:
vand wrote:
"It appears that companies may be leaning more toward share buybacks when it comes to returning cash to shareholders. This could be down to a desire to preserve dividend cover at newly rebuilt levels, the UK Government’s one-and-a-quarter percentage point increase in dividend taxes, or the pensions’ regulator’s threat to challenge dividend payments made by firms with pension deficits, or a mixture of all three."

And nothing to do with improving eps, a factor in many executive reward programmes .... ;)

V8


I think that this is overplayed as a factor. Executive schemes can and often I think have a provision to recognise and counter that.

Dod


Return to “High Yield Shares & Strategies - General”

Who is online

Users browsing this forum: No registered users and 8 guests