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5 More Dividend Stocks That Just Got Trumped by Treasuries

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Omnicom Group

omnicom group 185Advertising and marketing agency Omnicom Group (OMC) currently yields 2.5%. Not bad. Better still, it has cranked up its quarterly payout from 15 cents per share in 2009 to a hefty 40 cents per quarter as of this year.

You’d think that the near-tripling of the dividend would mean earnings have also tripled during that time. But you’d be wrong. In 2009, the 60-cent dividends were 23% of the $2.53 per share earnings. In 2012, the annual dividend total reached $1.20 per share, or 33% the $3.61 earned. This year, the company’s on pace to pay out $1.60 per share – a whopping 41% of the projected profit of $3.88.

Bottom line? Shareholders have become accustomed to increases, but the dividend’s growth rate is getting to the point where it can’t continue to improve. That won’t go over very well.

Article printed from InvestorPlace Media,

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