Results By Dividend Yield

Results By Dividend Yield

As a result of my tedious work, I was able to create, going back to 2006, the results by dividend yield.  Now the average gain of all MFI stocks has been 10%, to put things in perspective:

Yield Range	Pct Gain
no dividend	5.4%
Under 1%	8.5%
1% to 2.6%	9.5%
2.6% to 4%	20.7%
4% to 6%	26.6%
6% to 10%	10.6%
over 10%	19.7%

No big surprise here.  Results are much better with a 2.6% yield or greater.  Interestingly, they drop off at 6% and higher.  Anything magical about 2.6%?  Let us try expanding that range to 2% to 4%.

Yield Range	Pct Gain
no dividend	5.4%
Under 1%	8.5%
2.0% to 4%	17.1%
4% to 6%	26.6%
6% to 10%	10.6%
over 10%	19.7%
Grand Total	10.0%

Seems 2.6% cut off does better.

Now let us compare each of the gains with the benchmark (it seems possible when dividends are higher, perhaps benchmark does better?).

Yield Range	Pct Gain	Benchmark Gain
no dividend	5.4%	9.2%
Under 1%	8.5%	6.0%
1% to 2.6%	9.5%	8.9%
2.6% to 4%	20.7%	11.6%
4% to 6%	26.6%	12.0%
6% to 10%	10.6%	8.0%
over 10%	19.7%	11.2%

Not so much.  The benchmark does seem to do better at 2.6% stock yield and higher (10.7% versus 8.2%).  It does make some sense as a stock is more likely to yield over 2.6% when the overall markets are down (like in 2009).

I did one final cut, by market cap.  I will not show the table here as it is proprietary. But I will say that for larger market caps, things look good as the dividend increases, even a strong correlation than the overall table above.