The number of companies announcing lower dividends has increased over the past two quarters, while the number increasing them has fallen, based on the portion of dividend-paying stocks in the more than 9,000 global stocks followed by Wall Street Horizon. In the third and fourth quarters, 16% have lowered dividends, up from 14% and 12% in the last two quarters of 2021. There has been a corresponding decrease in the percentage that have announced higher dividends, with 21% doing so in the past two quarters vs. 25% in each year-earlier period.
Dividends have historically been seen as a signal about a company's prospects. For instance, in the first and second quarters of 2020 (the onset of the pandemic) 18% and 21% of companies announced dividend cuts vs. 13% and 12% in the year-earlier periods.