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Vodafone Group Public Limited Company Message Board

  • rrn48734 rrn48734 Feb 2, 2012 11:54 AM Flag

    No Dump after Dividend Pays

    You idiots who think the stock will drop after the dividend "pays" don't know what you're talking about. Stockholders of record LAST NOVEMBER will receive the dividend. Look at stock price history Nov 13 to 15, closed at 28.72. Nov 16 div of $1.123 record date. Nov 16 close - dropped $1.43 - closed at $27.29. The days leading up to Nov 16 were capture-the-dividend days. And the days immediately following were the tanking days. I bought on Oct 13th at $27.83. On an annualized basis, I made over 20%, even considering my small loss on the sale of shares at the closing price.

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    • The stock market has declined 50% twice in the last 12 years and you say price is no concern?

      But, you are talking specifically about VOD here. VOD peaked at $60 in 2000 declining to $14. Then peaked at only ~$40 in 2007, declining to $16 in 2009. Recent peak is $30. Hard to believe investors who held on during the last 12 years are ahead here even with dividend reinvestment versus getting out when yields are too low and valuations are too high.

      Comparing dividend yields to 10-year Treasury yields can get you both in and out of high yield stocks. Looking at earnings yields versus Treasury yields is also a no-brainer way to get out at high valuations (known as the Fed model).

      I'm doing a quick trade here I admit, but pocketed one dividend and more than $2 price appreciation on this trip. If VOD does not trade down to a sweet price, something else will.

      The situation in Greece is still not sustainable leaving the European banking system at risk -- less risk now than 2 years ago, but still at risk. As this plays out I expect a nice buying opportunity to unfold.

    • Those of us who are investors, not traders and gamblers, and who reinvest our dividends and plan to hold VOD for decades are happy to have more shares and compounded our future wealth regardless of the current price which is worry free for us.

    • <<You idiots who think the stock will drop after the dividend "pays">>

      2/2 close $27.23
      2/3 close $27.87
      2/6 close $28.24 (not everyone got their dividend 2/3 see posts here)
      2/7 $27.82 -$0.42

      Chart looks like an island top that will retrace to $27.23 2/2 close. We'll see.

      • 1 Reply to lincolnparker60614
      • I probably ought to have said "The idiots who think the stock SHOULD drop the day the dividend pays". The idiots who don't understand that the dividend obligation is created on the ex-date are the ones that cause the price to drop on the "pay" date.

        My obvious point, which I'm sure the informed understood: the ex-date locks in my dividend and reduces the per-share net corporate assets. If I value my shares based on those corp assets, then the share price SHOULD drop on the EX-DIV date rather than the pay date.

        If I value my shares based on some other method, then the ex-date may not affect my personal per-share value calculation. Enough - let's move on.

    • finally someone with intelligence. Thank you

    • Actually the price per share drops at the Ex-div date, not the payment date. This is because the dividend money is set aside, and no longer belongs to the company on the Ex-div date. However, depending on the size of the dividend, it may pass unnoticed.

      Depending on other factors, the share price may rise, fall, or do nothing at the time of Ex-div. This represents the not strictly mathematical or logical behavior of the buyers and sellers.

    • Some intelligence for a change! It amazes me how and why people invest without knowing anything about it.

34.65-0.05(-0.14%)Dec 24 1:00 PMEST

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