A strengthening world economy and rising corporate confidence pushed global dividends to a new high in 2017, according to the Janus Henderson Global Dividend Index.
Janus Henderson recently released its February 2018 edition of the Janus Henderson Global Dividend Index. Each year Janus analyzes dividends paid by the 1,200 largest firms by market capitalization (as of Dec. 31 before the start of each year).
Global dividends rose 7.7% on a headline basis — the fastest rate of growth since 2014 — and reached a total of more than $1.2 trillion.
Records were broken in 11 of the index’s 41 countries, including the United States, Japan, Switzerland, Hong Kong, Taiwan and the Netherlands. Every region saw an increase, according to the report.
“With all three of the largest economies in the world, the U.S., EU and China, expanding at the same time, companies are seeing rising profits, and healthy cash flows, enabling them to fund generous dividends,” the report states.
Looking specifically at North America, dividends finished 2017 6.9% higher on a headline basis at a record $475.6 billion, equivalent to an underlying growth rate of 6.5%.
The report notes that North American dividends make up more than two-fifths of the global annual total and have more than doubled since 2009.
The U.S. has been the key driver of global dividend growth in recent years. After a sluggish 2016, growth in the U.S. “picked up markedly in 2017, reaching 6.3% at the underlying level,” according to the report.
According to the report, U.S. companies paid their shareholders a record $438.1 billion, which is $24.4 billion more than the year before and a headline increase of 5.9%.