Who writes this drivel?
Dividends are cash. Companies can either keep and invest the cash or give it back to investors.
The question is: Is there more value to the shareholder if the company invests that block of cash or gives it back? The answer to that is always: IT DEPENDS.
It depends on management. It depends on the investment opportunities. It depends on the investor’s need for cash versus a continued investment. Etc. It depends on literally everything.
The idea that dividends are some sort of magic is silly. Dividends are at best a signal that at a particular point in time the management has excess cash flow that it thinks it can continue to distribute. But they could be wrong about that. And their competitor who doesn’t distribute the cash may have better ideas about investing. So the dividend itself is darned near meaningless.
I agree, dividends are cash that the company had no ideas for internally investing to generate increased company value.
They also have the downside of being double taxed, versus
share price growth that isn’t taxed until shares are sold.
IMHO, worse are share buybacks, most often this is an indication of complete lack of management vision and thus rely on bookkeeping tricks to give illusion of increased company value.
Which is why I sell boring, but stable municipal bonds. Capital preservation with tax free income.
As a Limited Partnership, BX has to pay out its full earnings to its limited partners as ‘dividends’. They are not really dividends, since you get a K-1 rather than a 1099.