Div = 7.65 per share??

[tnvolfan]

<TABLE style="PADDING-RIGHT: 10px; PADDING-LEFT: 10px" cellSpacing=0 cellPadding=0 width="100%" border=0><TBODY><TR><TD style="PADDING-LEFT: 12px; BORDER-LEFT: #c0c0c0 1px solid" vAlign=top width="24%">Hey guys I'm new to stock market investing, was just going thru my e-mail and found this. Whats the catch here? If I was to buy 200 shares by 10-16-09 would I
receive a div of 1,530.00 on 200 shares on 10-26-09.
Thanks for every ones input.

:think2:

<TABLE cellSpacing=0 cellPadding=0 width="100%" border=0><TBODY><TR><TD style="HEIGHT: 107px" vAlign=top width="100%">Income Notes Reynolds American (NYSE: RAI) recently raised its quarterly dividend by +5.9%, from $0.85 per share to $0.90 per share.

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The dividend is payable Oct. 26th to shareholders of record on Oct. 16th.

The company also said it completed its $425 million offering of senior subordinated notes announced last month. The proceeds from the 7.75% notes due 2014 will be used to finance the one-time dividend.

TransDigm said it had $190 million in cash as of Sept. 30th and an undrawn revolver of about $200 million.

-- Associated Press​

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[kuwlness]

Anytime a company does some crazy dividend like that, it's not usually a good sign -- there might be an accounting error, but who knows. Keep in mind, when a company pays a dividend, their stock PPS usually increases going into the dividend, and then on the Record date, it falls usually an equivalent to the dividend.

Now, this company does seem fairly legit considering its market cap, so I'd say it would appear they are trying to reward their shareholders. However, 200 shares of this company will cost you about $9000 by tomorrow. I've tried playing the dividend payout a few times and have never had much success. My advice for you (if you decide to play this dividend), that you get out on the Record Day. And I mean, you need to get up early and sell that sh!t in pre-market trading, before the market even opens.


If you want to see another company that offered a crazy dividend (keep in mind they were legit also), check out Ulticom (ULCM.pk). Check the charts and see what happened between April and May and you'll see what I mean. The day the stock got hammered was the Record Day of this strange one-time dividend. Just be careful and know what you're investing in and what you might get stuck with after the dividend and the sell-off. GL

 

[tiznow]

yeah i don't know what the hell these guys are doing

taking on debt at 7 3/4% to pay some cash to shareholders?

------------------

The company also said it completed its $425 million offering of senior subordinated notes announced last month. The proceeds from the 7 3/4 percent notes due 2014 will be used to finance the one-time dividend.

TransDigm said it had $190 million in cash as of Sept. 30 and an undrawn revolver of about $200 million.

Shares of the company rose 16 cents to $47.75 in afternoon trading.

--------------------------
looks to me like a good short target to me once it gets past the divy payment stuff

and like kuwlness said the stock will drop 7.65 once it pays

 

[tnvolfan]

thanks kuwl & tiz for the reply's, I will just watch
and try to learn something.

 

[Budman]

Anytime a company does some crazy dividend like that, it's not usually a good sign -- there might be an accounting error, but who knows. Keep in mind, when a company pays a dividend, their stock PPS usually increases going into the dividend, and then on the Record date, it falls usually an equivalent to the dividend.

Now, this company does seem fairly legit considering its market cap, so I'd say it would appear they are trying to reward their shareholders. However, 200 shares of this company will cost you about $9000 by tomorrow. I've tried playing the dividend payout a few times and have never had much success. My advice for you (if you decide to play this dividend), that you get out on the Record Day. And I mean, you need to get up early and sell that sh!t in pre-market trading, before the market even opens.


If you want to see another company that offered a crazy dividend (keep in mind they were legit also), check out Ulticom (ULCM.pk). Check the charts and see what happened between April and May and you'll see what I mean. The day the stock got hammered was the Record Day of this strange one-time dividend. Just be careful and know what you're investing in and what you might get stuck with after the dividend and the sell-off. GL

Kuwl,
Isn't it better to get out 2 days before the record day, that way you get the dividend and hopefully protect your gains.

 

[Budman]

MDRX, a stock that paid a special dividend, around a year or so ago of $5 plus. I bought it for my children at $4.80 and is now $20. My point being every stock is different, do your research and be careful.

 

[kuwlness]

Kuwl,
Isn't it better to get out 2 days before the record day, that way you get the dividend and hopefully protect your gains.

Yes, I apologize. I always mix up the Record date with the Ex-dividend date. As long as you sell on this day, you'll get the dividend, but the new owner of the shares will not. You just need to be the owner of the stock prior to this date. The date of record is usually 2-3 days before the Ex-date because it basically takes 2 days for the shares to fully be considered yours (even though this is a technicality). Head over to Investopedia and look up some definitions on this stuff, makes it much easier.


This is the best explanation I can share with you:
http://www.investopedia.com/articles/02/110802.asp