Jake 1349 summed up the dividend situation as succinctly as possible in #800.
The reason there is a special dividend is that the new PZN is treated for tax and accounting purposes as if it were the old CCA, having acquired the old PZN.
To be a REIT, new PZN can't have any of CCA's "earnings and profits". That's a tax term, but it is essentially retained earnings. Thus new PZN has to pay out old CCA's retained earnings by the end of this year in order to be a REIT.
You have to be a shareholder of record when the special dividend is formally declared (as Jake said, .05 per quarter through September, then about 1.85 in December).
You two are sure alot more help and quicker to respond than the IR of PZN. Thanks for the explanation. Do you think that we would see a drop in share price in proportion to the special dividend when it is paid out? Or might we see a surge in the stock price in the 4Q anticipating special dividend? Should I wait until 4Q to buy more or is there potential for appreciation before then? Thanks
I'm also reivensting my dividends but I'd be in no hurry to put in new money. Despite CRN's good relative showing, I'm convinced we have a bad Sector thing going on here and things have not yet bottommed out. (I once read that 90% of a stock's performance is determined by the sector it is in; I believe this more every day.) WHC's performance today and CPV's recent performance are leading us to a bottom but we aren't there yet.
just happened to be sitting here contemplating my well-offness.
As I understand it (and as seemed to happen on March 19), PZN will open lower on the day after the dividend record date by the amount of the dividend. Thus if PZN closes at $17.40 on December 19, and if that is the record date for a $2.40 dividend (special or otherwise), it will open on Dec 20 at $15.00.
I guess in theory the dividends are priced into the value of the stock, so the price shouldn't go up much as the dividend approaches. Don't wait to buy just before the dividend - it won't work.
Now, should the stock appreciate without regard to all this? Seems to me it should (I'm not selling, and am reinvesting the dividends as Flipper advised). When will it? I said a year ago that it could take a year to recover. It's just gone lower. But I truly believe it is undervalued. Just my opinion.