What happened
The stock of General Electric (GE 1.44%) was a bit of a dim light on Hump Day, inching up only by 0.4% while the S&P 500 index glowed more than 3% brighter on Wednesday. It seems investors were signaling their lack of enthusiasm for the latest shareholder remuneration effort from the company.
So what
On Wednesday, General Electric declared its latest quarterly dividend: $0.08 per share, payable Jan. 25 to investors of record as of Dec. 15.
While not all dividend investors have the same philosophy or approach, it's safe to say that most hope that those dividends will be raised. Those hopes are fading with General Electric, as it has kept that $0.08 steady since September 2021. The January payout will be the fifth in a row at the same rate.
That lack of dynamism is combined with a low yield. At 0.3%, General Electric's is teasing floor level compared to other name companies that regularly pay dividends. At the moment, the average yield of S&P 500 index companies that hand out dividends is 1.6%, more than five times General Electric's rate.
Now what
On top of that, investors might believe that they should be better compensated. Yes, the company has famously had its troubles in the recent past, but its aerospace business is surging ahead despite supply chain difficulties, and as a whole it should land well in the black for full-year 2022.
Meanwhile, cost-cutting has already proved beneficial, and looks set to continue helping the bottom line.
