Companies across the globe are expected to shrug off economic uncertainty to return more of their cash to investors this year, one asset manager believes. Investors could share $1.72trn (£1.3trn) of dividends this year, almost 4% more than they pocketed in 2023, according to Janus Henderson.
If the firm’s projections prove to be correct, dividend payments this year could be 3.9% higher on a headline basis, the equivalent of an underlying 5% rise in 12 months.
And dividends could still rise this year, despite an expected decline in special one-off payouts, which have hit record levels in the past three years.
However, the growth of regular dividends is also expected to be lower.
Last year a record $1.66trn (£1.3trn) was handed back to shareholders, which was a 5.6% headline rise year-on-year, although on underlying basis it was flat at 5%.
Pessimism over the global economy did not impact company balance sheets last year, and so Janus Henderson has a strong outlook.
Despite slower economic growth and higher funding costs, strong US dividend growth in the fourth quarter bodes well for the year ahead, while Japanese companies are returning more capital to shareholders and dividends in Europe are well covered by earnings.
Then there are banks, which delivered record payouts last year thanks to higher interest rates. Ben Lofthouse, Janus Henderson’s head of global equity income, said pessimism over the global economy has proved ill-founded and although the outlook is uncertain, dividends are well supported.
“Corporate cashflow in most sectors has remained strong and is providing plenty of repower for dividends and share buybacks,” he added.
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