Dividend and Conquer!

We received our first dividend check last week, so time for the obligatory write up on all you need to know re dividends.

https://freetrade.io/blog/dividend-and-conquer/

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On the topic, I don’t quite understand why Apple has paid 1.5% dividends this year being a (arguably) tech stock, hence dividends is not something shareholders would expect in the first place. I am sure they would have invested this money into R&D more effectively than said shareholders. Any thoughts?

Maybe because they have nearly $300,000,000,000 in cash lying around? They can afford all the R&D they want and dividends as well.

Edit; I missed a few zeros!

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On the topic of dividends, I wish I’d got into buying dividend shares and reinvesting sooner, not as exciting as gambling on high growth stocks but longer term it’s a sure winner

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Totally agree! Dividends are certain, while future growth is uncertain.

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Apple: I wonder if it is because deploying all of that capital would actually be hard at their scale: they already spend a lot on R&D. Also the dividend expense is gradually getting cheaper in absolute terms (because in parallel they’re still buying back shares - Apple mgmt considers them under-valued).

You could almost think of AAPL as a very low-risk bond with a good yield: the company generates loads of cash and aren’t disappearing any time. And sometimes the stock delivers capital growth :slight_smile:

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