Tuesday, April 14th 2020
Dividend Suspensions And One Increase, JNJ
JNJ announced earnings and raised its dividend. The ORATS earn move and dividend forecasts for JNJ are shown with other cancellations of dividends and changes.
Johnson & Johnson (JNJ) announced earnings and raised its dividend from $0.97 to $1.01, a change of +4%. ORATS earn move report reflects the options market expectation of a $2.82 move by the close today. Many other companies have suspended or cancelled their dividends due to the coronavirus pandemic.
We have seen many dividend suspension since the corona chaos, but this morning we have an announced increase in dividends from Johnson & Johnson (JNJ). JNJ announced earnings this morning and its dividend that will go ex on 5/22/2020 and raised div from $0.97 to $1.01 a change of +4%. JNJ is up 3% to $144 in pre-market trading. ORATS earn move report below reflects the options market expectation of a $2.82 move by the close today.
Interestingly, the options market was expecting JNJ to announce its ex dividend date as after the 5/22/20 expiration. That expiration had a zero implied dividend as of yesterday. Here's the JNJ historical and forecast:
Here are some of the many dividends that have suspended/cancelled:
Our dividend consultant has the following notes for our forecasts:
CNP - reduced dividend to 0.15 from 0.29
SM - reduced dividend to 0.01 from 0.10
KMI - div reduced to 0.27 from 0.3125.
MET - added to override to show the company’s annual div increase pattern.
PFE - watching this one, might move upcoming date to 5/7
WELL - fine for now, will watch
ZION - leaving at 0.34 5/14 for now. I will watch as this is a regional bank stock that could decide to suspend/cancel.
Calculating what the options market implies for a dividend involves lining up the call and put weighted implied volatilities and getting the inputs for interest and dividends consistent.
Implied dividends have foreshadowed cuts by DIS WYNN and other firms. Using options prices to implied dividends ORATS presents a possible suspension list of companies.