Continuous evolution and adapting to one’s environment is key to survival. This was first stated by Darwin in the context of life form on Earth. However, the essence of its meaning can very well be applied to businesses and corporations. Great many American corporations that failed to adapt with changing business environment have perished. IBM is one company that seems to understand Darwinism. I believe IBM is a one of success stories of business transformation.
IBM was the company that invented and helped develop many of the electronics and semiconductor industry’s significant technologies. It had been one of the early adopter of the concept of using electronics in actual products for ease of computing. Examples are personal computers, DRAM memories, hard disk drives, and numerous other component hardware technologies. It flourished with those electronic products. However, today’s IBM gets less than 20% of its revenue (which is continuously decreasing) from hardware products. continue reading rest of the article….
This article originally appeared on The DIV-Net, March 25, 2009.
Standard and Poor’s “S&P North American Technology Sector Index” (henceforth referred as Tech index) is widely used to benchmark the technology sector in North America. As of February 2008 the Tech index had a weightage of approximately 20% to 23% in overall S&P500 index.
The Tech index represents different sub sectors that include hardware (20 companies), internet (21 companies), multimedia networking (27 companies), semiconductors (43 companies), services (31 companies), and software (40 companies). This is a total to 182 companies in the Tech index. However, similar to any market capitalization based index, Tech index is also top heavy. The cumulative weightage for top 10 companies is approximately 64%, for top 20 companies it is approximately 79%, while top 30 companies it is approximately 86%. The table below shows top 30 companies including the annual per share dividends. There are 17 companies out of top 30 companies that pay quarterly dividends. continue reading rest of the article….
A quick and simple answer is, no it does not affect dividend growth if dividend investors understand what it really means.
Corporations pay dividends from the combination of profitability, cash flow, income, prudent money management, etc. With the current state of economy in United States (and other parts of the world) majority of the corporations are facing negative growth. In such a scenario where will dividend growth come from? In these challenging environment dividend investors need to look at the macro economic scenario and understand how it will play out in long haul over a period of next 10 years, 20 years, or 30 years.
We read a lot about demise of US dollar. At a very fundamental level, which country’s currency becomes a global currency will depend upon political maturity and economic stronghold at global level. continue reading rest of the article….