Published September 27, 2008
Source: Businesstimes.com
Some of the yield figures have been inflated by exceptional dividend payouts last year by many smaller companies. Several small firms had dished out dividends to use up their tax credits, which expired at the end of December last year.
'Investors should look at bigger companies with a dividend policy, strong earnings over the past few years,' said one analyst from a local bank.
Profits are tied to the dividend payout as the latter is dished out from the company's retained earnings. Firms which are more established typically do not need to reinvest their profits for expansion purposes and hence choose to pay them out to shareholders.
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