Longtime Fools may wax nostalgic at the mere mention of Iomega
The years went on to bring shareholders their good share of ups and downs, but now they will be getting something entirely different: a fiver. Last week, the company announced a one-time $5-per-share dividend to its investors. Our own Tony Miller was skeptical about the move.
But Iomega isn't alone. At the same time, Pomeroy IT Solutions
Thanks to flat money market yields and the new tax-advantaged status of dividends, sharing the wealth directly with investors is the latest fashion being sashayed down Wall Street's catwalk.
Even the mighty Microsoft
So if money is raining down from the corporate coffers in the sky, what's an investor to do at the first sight of pennies from heaven? Run. Just slip into warm galoshes, button down that raincoat, and run away.
Don't confuse these one-time payments with solid companies that have gradually raised their dividend payouts over the years; those are sound, growing blue chips. These one-time distributions, on the other hand, are usually desperate surrenders from companies that have forgotten the difference between investor and investment.
If they haven't found ways to invest their idle cash to ultimately grow shareholder value, how confident can you be with their ability to appreciate the money they're keeping? When it comes to these one-time yields, maybe a one-time withdrawal is the best response.Hungry for yield? What do you think of the companies announcing these one-time dividend distributions? Are there better ways to milk some income out of your portfolio? All this and more -- in the Investing for Income discussion board. Only on Fool.com.