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So INTC declared the Q4 dividend today -- 22.5 cents. Exactly the same since the middle of 2012. While folks have been upset that they have not raised the dividend for two years now, it is only with this announcement that the 10-year streak of raises is officially dead (by the way I count, anyway, which looks at calendar years).
I had held out hope that they would announce a small raise to satiate beleaguered shareholders and to keep the streak alive. I don't think it would have been unreasonable given that the payout ratio is still below 50% and that 2014 has brought somewhat better earnings.
I know some of you have bailed out of INTC already -- how will the rest of you react to this latest announcement? I'm standing pat.
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Standing pat. Cost basis less than $20 in both our accounts. Voting no for say on pay and against all board members on all proxies. Will sell sooner or later.
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan
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I'm a little sour about this myself. In my scoring system, INTC lost 10 points on this news alone, going from an already underwhelming 53 to a pathetic 43. I'm not inclined to rush out an sell the rest of what I've got, because it is held in a taxable account and has a nice gain that I'd have to pay taxes on, and like Tom, my personal yield is pretty good. However, I may start paring down and using the proceeds to up my allocation of more dependable dividend growth stocks that are looking good on the recent dip. My top prospects right now are MCD, XOM, T, and maybe some DE.
Standing pat for now. DRIP has been turned off and might start selling calls against it. With YOC over 4% hard to sell right now. Also don't really want to sell since it looks like to me that they are turning it around with the better earnings in 2014.
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I sold INTC last year when I realized the company wasn't going anywhere in term of long term growth. They don't increase their dividend payouts because they can't sustain increasing their payment over time. INTC has to concentrate on switching their business model (leaving the PC as core business to tablets or cloud computing). This switch is not without risks.
There are too many great companies to keep INTC in my portfolio. I'm happy I sold it last year and bought something else. INTC looks more like a value trap than anything else for me. If you keep it, wish it will successfully switch their business model.
With a YOC of over 5% I'm keeping my shares.
Besides I know that Intel is focusing all its attention (and funds) to cover the gap in the mobile department with the competitors so I consider this as funds well spent.
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I am glad I dumped mine about a year ago. We'll see how far it sells off tomorrow if all the DGI'ers sell since most have "do not cut or freeze a dividend" as one of their rules.
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Well, I guess I started the ball rolling. Sold a November covered call today with a strike price at $36. If it hits, I won't be unhappy and if not, I can do it all over again.
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan
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Holding INTC. They will raise the dividend soon. They have some problems now but these will eventually be solved and they will starting raising their dividend again. It's not like INTC will be going bankrupt soon.
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This is where I will stick with a frozen angel for a spell to see how things go.
There are people who use up their entire lives making money so they can enjoy the lives they have entirely used up
Frederick Buechner
