The best dividend companies in 2020 [Ranking]

2020 is slowly coming to an end, but it is not too late to buy listed companies with dividends in mind. What are the the best joint stock companies, paying dividends in the fourth quarter of 2020?

Selection of dividend companies

What factors to consider when selecting dividend companies? In the old days, dividends were the main motivation to buy stocks. Shares were bought with a view to dividends, i.e. a share in the company's profits. Currently, stocks are bought with a view to increasing their price and earning on the difference between the buying and selling prices. A dividend is a nice addition for many, but there are investors for whom the dividend yield is a decisive factor in making a decision to buy shares.

Dividend amount

The most important factor is, of course, the amount of dividends paid. Average dividend amount on American and European companies is now around 2%.

Payout ratio or payout ratio

In addition to the amount of dividends, an important indicator is the so-called payout ratio, i.e. the ratio of dividends paid to the company's profits.

Ex-dividend day

Important information apart from the dividend payment date (dividend payment date) is ex-dividend day. This is the date by which shares must be held in order to be eligible for dividends. Therefore, if the dividend payment date is October 1, 2020, but the ex-dividend day is September 11, 2020, it means that we can sell the shares on September 11, 2020 and we will still receive the dividend on October 1, 2020. We can also keep them longer, of course.

If we buy shares after ex-dividend day, i.e. in our case after September 11, 2020, we will not be entitled to the next dividend. We must have them before the ex-dividend day.

Top 5 Paying Companies dividend in IVQ 2020

Bristol-Myers Squibb [BMY]

• • Dividend rate: 3%
  • Payout rate: 207%
  • Dividend day (ex-dividend day): SEPTEMBER 1, 2020
  • Dividend payment date: November 2 2020

American pharmaceutical giant with a market capitalization of over $ 130 billion. The company pays dividends quarterly. The company has developed and sells drugs for cardiovascular diseases, cancer, diabetes and rheumatism. The sale of the anti-cancer drug Opdivo alone brings the company $ 10 billion a year. Analysts expect the company's revenues to increase by 15% over the next 5 years.

British American Tobacco [BTI]

• • Dividend rate: 7.5%
  • Payout rate: 62%
  • Dividend day (ex-dividend day): SEPTEMBER 1, 2020
  • Dividend payment date: November 17 2020

The market leader in the tobacco industry, with a market capitalization of more than $ 80 billion. It pays a quarterly dividend, allocating about 60% of profits to dividends. The company invests the remaining profits in development. The company's flagship brands are Camel, Lucky Strike, Dunhill, Pall Mall, and Vuse e-cigarettes.

Altria Group [MO]

• • Dividend rate: 7.45%
  • Payout rate: 79%
  • Dividend day (ex-dividend day): 14 Września 2020
  • Dividend payment date: November 9 2020

Another tobacco giant, previously known as Philip Morris. It is one of the world's largest producers of tobacco and tobacco products. The market capitalization of Altria Group is currently $ 80 billion. The company allocates nearly 80% of its profits to dividends.

Canadian Imperial Bank of Commerce [CM]

• • Dividend rate: 5.25%
  • Payout rate: 60%
  • Dividend day (ex-dividend day): 25 Września 2020
  • Dividend payment date: November 28 2020

One of Canada's five largest banks, it currently has a market capitalization of $ 45 billion. The company pays dividends quarterly, allocating 60% of profits for this purpose.

Bank of Nova Scotia [BNS]

• • Dividend rate: 6.16%
  • Payout rate: 68%
  • Dividend day (ex-dividend day): SEPTEMBER 5, 2020
  • Dividend payment date: November 28 2020

The second Canadian bank on our list, with a market capitalization of USD 66 billion and a very long history of operation. It was founded 188 years ago. The bank pays dividends quarterly, the payout ratio is 68% of profits.

The S&P 500 Aristocrats' dividend

When writing about the best companies paying dividends, it is impossible not to mention Dividend Aristocrats S&P 500 index, currently consisting of 66 companies that have been paying dividends to their investors for at least 25 years.

You can invest in the index using ETFs:

[NOBL] The ProShares S&P 500 Dividend Aristocrats ETF

• • Issuer: ProShares
  • Annual fees: 0.35%

The fund buys shares of companies from the S&P Dividend Aristocrats index. The share of individual companies in the fund is even and independent of capitalization. NOBL is very popular and manages investor assets worth $ 6 billion. The daily spreads are as low as 0.02% and the dividend payout is 2.12%.