How much will International Business Machines (NYSE: IBM) pay out in dividends this year?
It seems like a simple question, but there are layers to it. You can look at Big Blue’s dividend payouts from a few different angles — and they’re all helpful to prospective IBM investors.
Dividends per share
IBM likes to increase its dividend payout per share every year. The streak of annual dividend boosts started in 1995 and continued with the 29th straight boost earlier last week. The quarterly payout now stands at $1.67 per share, adding up to $6.68 per share over the next year:
Total dividend payouts
You can find out how much cash IBM returned to shareholders in the form of dividend payments in two simple ways:
Look up the “dividends” line of IBM’s cash flow analysis, a standard part of its quarterly earnings reports.
Multiply the dividends per share by the number of basic shares outstanding, a figure found in the same report’s “comparative financial analysis.”
Whichever way you calculate the dividend, IBM’s cash payments landed at $1.52 billion in the first quarter and $6.06 billion over the last four reports.
Dividends as a percentage of free cash flow
You can also look at the portion of free cash flow IBM sends out to dividend recipients.
IBM’s cash profits stood at $1.9 billion in the first quarter, or $11.8 billion over the last four reports. For the dividend, that’s an 80% share of the single-quarter free cash flow and a 51% cash payout ratio on a trailing-12-month basis.
Changes in 2024?
IBM’s dividend increases are as reliable as clockwork but not always large. Likewise, the number of shares has stayed nearly flat in recent years. So the dividend payouts over the next 12 months will look like this:
$6.68 per share, up from $6.64.
$6.12 billion in total dividend payments.
Approximately 51% of free cash flow, estimated to reach $12 billion this year.
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Anders Bylund has positions in International Business Machines. The Motley Fool recommends International Business Machines. The Motley Fool has a disclosure policy.
How Much Will IBM Pay Out in Dividends Over the Next Year? was originally published by The Motley Fool
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