With the recent spate of companies either issuing a special dividend before the end of the year or rolling back a January dividend to pay out in time to avoid the fiscal cliff tax increases, Motley Fool analyst Blake Bos decided to look into what's behind these special dividends. Do they benefit the company paying them, and should shareholders take them as a good sign? In this video, Blake discusses several different scenarios, and what paying dividends can mean for a company with slow growth sitting on a lot of cash, versus a company with large growth potential and a lot of capital expenditures.
Blake Bos has no positions in the stocks mentioned above. The Motley Fool owns shares of The Buckle, Costco, and Dillard's. Motley Fool newsletter services recommend The Buckle and Costco. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.