Photographer: Dario Pignatelli/Bloomberg

Singapore Loves Dividends, Australia Most Generous

  • Australia’s 4.2% yield highest among developed markets
  • 97% of Singapore stocks paid dividends versus 70% in S&P 500

Dividend-dependent investors were best served by the Asia-Pacific region last year, with Australia’s benchmark index offering the highest yield among developed countries and Singapore providing nearly ubiquitous payouts.

Singapore and the Philippines led the world in the proportion of companies that made or pledged dividend payments, with about 97 percent of companies in both Singapore’s Straits Times Index and the Philippine Stock Exchange PSEi Index having an ex-dividend date for the 12 months through Dec. 31, according to an analysis of about 70 national equity benchmarks by Bloomberg.

In fact, eight of the top nine markets with the most prevalent payout ratios were from the region, with South Africa as the only outlier. Thailand, Hong Kong, India, Malaysia, Australia and China were the other leaders, with more than 90 percent of companies in their benchmark gauges offering dividends.  

Payout Power

Asia Pacific had eight of the nine markets with highest percentage of member stocks paying dividends

Note: Number of index members paying dividends was based on companies with at least one "ex-dividend date", or the last day the stock owner is entitled to receive the dividend should he/she sells the stock thereafter, between 1/1/2017-12/31/2017; Declared and recorded dividends classified as liquidation, discontinued, return of capital, partnership distribution, omitted or cancelled, were excluded; Each index was individually researched; Regardless of dividend frequency

Source: Bloomberg

By contrast, 70 percent of Standard & Poor’s 500 Index member stocks set at least one ex-dividend date in 2017. Japan was even more of a laggard among advanced markets, with only 20 percent of Nikkei 225 companies declaring payouts.

Australia’s S&P/ASX 200 Index offered the highest dividend yield among developed markets -- 4.18 percent -- followed by Norway at 4.08 percent and the U.K.’s 4.02 percent. The MSCI EAFE, a gauge of developed-markets that doesn’t include the U.S., closed the year with 3.02 percent. The yield for S&P 500 companies averaged 1.89 percent, with figures based on gross payout. Australia’s benchmark index has consistently yielded 4 percent or more this decade.

Dividend Yield In Developed Markets

Australia's S&P/ASX 200 Index members topped the chart

Note: Dividend yield shown here was the sum of gross dividend per share amount for all dividend types that have gone "ex" over the prior 12 months, as a percentage of current stock price; Data as of 12/31/2017

Source: Bloomberg

Bloomberg research excluded dividend types that are neither recurring, such as partnership distribution, nor those that signify less than positive prospects such as discontinued and liquidating dividends. The ratio of index members paying dividends was based on companies with at least one ex-dividend date, or the last day the owner is entitled to receive the payment should he or she decide to sell the stock during the calendar year.

A new tax law taking effect in the U.S. this year may see an earnings bump, particularly for those domiciled outside of the country. Research firm IHS Markit Ltd. predicts annual dividend growth to slow to 7.7 percent in the U.S., one percentage point below the 2017 rate, yet noted the reforms could potentially push the eventual growth rate above 10 percent.

At the end of 2017, 31 companies in the S&P gauge were incorporated outside of the U.S., including some involved in the biggest inversion deals in recent years: semiconductor-maker Broadcom Ltd., through its merger with the Singapore-based Avago Technologies Ltd., and pharmaceuticals firm Mylan NV setting up in the Netherlands after buying some generic-drugs assets from Abbott Laboratories.

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