Evening star., 1931-12-17
DROP IN DIVIDENDS
IS 2.8 PER CENT
Moody's Average for GOO
Stocks Now Stands
at S2.O5.
Special Dispatch to The Star.

0SNSAoA NAopdtCH 10 Inc star,
NEW YORK, December 1.-THE
average weighted dividend rate on the
boo active stocks listed on the Nev
YORK Stock Exchange on Decenobar
mad declined 1913 per cent from the
peak registered in March, 1880, ac-
corong to new study of dividend
action issued for the first time TODAY
py Moody's Investors Service. The com-
pllatlon is based on practically every
active stock traded in on the EXCHANGE
Cosether with 80 bank and insurtfnce
SUCKS quoted over the counter, In
June, 1879. when the survey was begun
ABOUT 30 per cent of the total nur1bfr
were on cash-diVidend basis, while
at the present time only go per cent
are cash-dividend payers.
For the entire 600 stocks, the weight
eo average dividend rate at the middle
OF 1929 was $288 per share. the stndv
SHOWS IhlS represents an aggregate
annual rate of S2,454 $50 0OO Despite
tne STOCK market crash in the Fall O!
1879 the average per-Share payrnent
increased regularly into February of
the following year, when it amotrrted
10 S3.Oo. The same rate held for March
put no advance was recorded in anv
later month, with the result that the
continuous decline has brought the in
oeX Gown to s2.05 on December 1881
lepresentlng at that time total annual
payment of 1888, 12O ooO
Extent Of Downward Trend.
In the introduction to the survey
MoodyS points out that it is obvious
that the trend of dividend payments
mas been downward for many months
But now much have these payments
oeen cut, how far have they receded
from the high peak, and when was this
llgn peak made?", Moody asks Cues
tions of this kind have been almost IN
possible to answer in the past, due TO
the lack OF adequate statistics. -
We have seen monthly compilations
OF total dividend payments, but these
scarcely serve as basis for comparison.
1or several reasons. They generally
fail to consider the wide Seasonal
tiuctuat!on in dividend payments: they
have never, so far as we can discover
Deen confined to given group of COM
panles, and in addition they often rep
resent payments made on the basis Of
olVloend rates which have been cut or
omitted IN the meantime. All these
obstacles seem to have been overcome
by this new study"
An identical list Of 600 stocks is used
throughout the period under review.
and 1t is stated that these same com
panleS will form the basis of future
I computations. Both dividend and nom
dividend paying issues are included.
AS revealed by the index, the general
trend OF dividends shows a pronounced
lag when contrasted with business ac-
tiyity.
The progressivs decline over the last
Il months unlI1H ha
tial, the analysis comments, we're it not
1or the stabilizing influence of some Of
the largest companies At the present
time six companies, or only | per cent
OF the total number, are disbursing 25
per cent Of the aggregate dividends and
their payments collectively are now
slightly larger than in March, 1880.
With the six companies eliminated, the
Gecllne from the peak is found to be
3S2 per cent rather than 32,8 per cent.
Wide variations between individual
groups are evident Moody's continues.
The best showing has been made by
the utilities and banks, with respective
drops of only SO per cent and 6 per
cent from their peak months. Among
Industrlals most stable records are held
by the can manufacturing, food, shoe
and tobacco companies. At the ether
end OF the scale are the copper, miscel-
4aAeouS mining and theater stocks,
Industrial List.
For 492 industrial stocks the decrease
from a peak of December, 1929. has
been 4l.2 per cent Coincidentally, the
d!op for SO rails was almost exactly the
same, amounting to Al per cent. It is
interesting to note. however. that the
peak OF railroad dividends was astab-
ilshed nine months later than that for
industrials."
The survey describes the method Of
computation as follows: For each Of
the 500 companies there is made a
monthly record of the total annual
cash dividends which would be paid
on the basis Of the most recently an
nounced rate. Each months aggregate
OF dividends for all 600 companies is
then divided by the total number of
shares outstanding during the month.
after adjusting for stock dividends and
splits. This procedure eliminates from
the average dividend rate the effect of
changes in share Capitalization.