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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Tapcon who wrote (31836)	8/25/2008 8:25:05 PM
From: Paul Senior	Respond to of 78751

About: "AIB divvie looks to have been cut in future". It does look that way, but that is not the correct view. Imo. Because AIB pays a dividend twice per year and because the amounts are different, "somebody's" computer program that a lot of companies apparently use, can't correctly annualize payments based on one period's number, or can't correctly add both semi-annual distributions. Therein lies a benefit to those who perceive the correct dividend. What is skipped over when somebody scans for stocks - 7.96% yield (which is very good albeit maybe just okay vs. other dividend-payers) - gets more focused on when it turns out the dividend yield is closer to 10-11%, with a history of no-cuts. I'll clarify my comment, "looks like $2.54/24.20 = about 10%", Unfortunately I can't for certainty say what the true dividend amount is to USA taxpayers from the data I see. There's a surprising difference among data reporters. Perhaps some report the euro dividend in US $ as of ex-dividend day. Perhaps somebody else reports the euro dividend when the euro is converted and received on the dividend receipt date: latest dividend shows about six weeks after ex-div day (8/6/'08) to scheduled receipt (9/26/'08). (Also to be considered, there's likely some Irish withholding tax. (I've not checked that yet.)) I can offer these numbers and before-tax yields: From Yahoo. (Look at "historical prices" and check "dividends" box) 8/08: .953 2/08: 1.501 8/07: .761 So that's the source of my .953 + 1.501 = $2.45/sh. Sorry I transposed .45 in my previous post. Still, the yield % remains as I said: 2.45/24.20 = 10%. (before some Irish withholding tax, I presume) Now if I look at S&P report for AIB, I get 8/08: .953 2/08: 1.609 8/07: .769 So based on S&P, the current annualized dividend yield is (.953+1.609)/24.20 = 2.562/24.20 = 10.6%. Maybe a tad higher if AIB's closing price of $23.97 is used. The stock dropped under $24 today. If I can buy the stock somewhere closer to $23, I'll up my position. However I look at it, I'll be figuring - if the dividend doesn't get cut, and if we're near a low for the stock - the dividend yield before Irish withholding should be somewhere around 10.5% -11%. Pretty good for a bank stock that still seemingly has a franchise. Jmo, but I've been wrong many, many times.