The long anticipated initiation of a regular dividend payout from Cisco Systems has finally been announced today. The San Jose, California headquartered company will make the first ever dividend payout of 6 cents per share on April 20th to all shareholders of record March 31.
It’s been a long running rumor that Cisco would initiate a regular dividend in early 2011, with a target yield of 1% to 2% initially. Based on todays current price of $17.46, the dividend yield comes out around 1.4% per year. Not a huge dividend, but given the performance of Cisco stock (it hit a new 52 week low last week when it dropped below $17 per share) the dividend announcement should help prop up the stock.
With the new dividend, current investors are rewarded for the their patience, while new buyers in the form of dividend focussed mutual funds, should create demand for CSCO shares going forward.
Cisco Systems Dividend (CSCO)
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