What is a Dividend? – A Summary of Definitions about Dividend

What is a Dividend? – Definition of Dividend By Dividend Yield - Stock, Capital, Investment. What is a dividend? A dividend is a payment by the company to its shareholders. Normally, a stock pays 4 times a year a quarter dividend in order to let investors participate at the company’s success. The amount of dividends in relation to the earnings of a company is called payout ratio. This figure measures the part of the earned money which is paid to the shareholders. A value of 50 percent (half of its earnings) is a good figure. Sometimes it could be possible that companies can pay 90 percent of its net income due to its business model. Such businesses are those which don’t need much money for growing.

What is a Dividend By Wealthpilgrim - A dividend is a cash payment to people who own shares in companies. The cash is usually paid out of the profits the company makes and they are usually paid quarterly.

In most cases, preferred shares pay the highest dividends. Master Limited Partnerships often pay quite a bit.  But not every company pays dividends. But that doesn’t necessarily mean that owning shares in companies that do pay dividends is a better investment. Basically, every profitable company has a decision to make. They can either take those profits and re-invest in the company or they can pay the profits out to the people who own shares.  People who want to retire now often like getting those dividends but it might be short-sighted.

What are dividends by Wikipedia - Dividends are payments made by a corporation to its shareholder members. It is the portion of corporate profits paid out to stockholders.[1] When a corporation earns a profit or surplus, that money can be put to two uses: it can either be re-invested in the business (called retained earnings), or it can be paid to the shareholders as a dividend. Many corporations retain a portion of their earnings and pay the remainder as a dividend.

A definition of diviends by Ask.com - Some stocks, especially blue chips, pay dividends. This means that for every share you own, you are paid a portion of the company's earnings. For example, for every share of AT&T you own, you will get sent $0.15 every year. Most companies pay dividends quarterly (four times a year), meaning at the end of every business quarter, the company will send a check for 1/4 of $0.15 for each share you own.

Dividend definition by wiseGEEK - A dividend is money paid directly to an investor in a company's stock. Some publicly owned companies offer a dividend with their stock, while others do not. The choice of buying and owning a stock that pays a dividend is up to the individual investor, as there are both positive and negative aspects to consider. A company that offers a dividend with its stock is often a larger, more stable business in a field with little growth or a slow, steady growth potential.

Finally a video from Investopedia: