The short answer is that Amazon does not pay dividends because the focus of Amazon is growth and expansion. A dividend payment would take away the funds needed to expand. They have stated several times and even on recent earnings call that there is not a plan for Amazon to pay dividends.
It does not make sense for Amazon to pay dividends . Amazon expanding at breakneck speed. Yes, it has good cash flow and company utilised to clear some long term debt. But again, acquiring Whole Foods, it has contracted good amount of debt.
Amazon is free cash flow-positive, meaning it generates free cash flow that could be used to pay dividends . In the past four reported quarters, Amazon generated $26.4 billion of free cash flow, up 9% from the previous 12-month period.
While researching we ran into the query “Should Amazon (AMZN) pay dividends?”.
One lingering holdout to paying dividends to shareholders is e-commerce giant Amazon. Com Inc. (AMZN). Rather than return cash to shareholders, Amazon continues to plow its cash flow back into the business. The decision whether or not a company should pay a dividend depends on many factors .
Some articles claimed common stock dividends paid can be defined as the cash outflow for dividends paid on a company’s common stock Amazon common stock dividends paid for the quarter ending September 30, 2021 were $M, a NAN% increase year-over-year.
You should be wondering “Why do companies not pay dividends?”
There may be several reasons why a company does not pay dividends, but the most common would be that they believe their profit is better spent on something else. Some companies prefer to spend most of their cash back into the business, spending on operations to further grow the company.
How much did Amazon Pay in dividends in 2021?
Amazon common stock dividends paid for the twelve months ending September 30, 2021 were $0M, a NAN% increase year-over-year. Amazon annual common stock dividends paid for 2020 were $0B , a NAN% decline from 2019.
That payout level would provide a current dividend yield of just 0.4%. The very low dividend yield is the result of Amazon’s sky-high share price , currently above $3,300. A dividend yield of 0.4% would be virtually meaningless for income investors.
The very low dividend yield is the result of Amazon’s sky-high share price, currently above $3,300. A dividend yield of 0.4% would be virtually meaningless for income investors .
Is Amazon stock a good dividend stock to buy?
Over the past 10 years, Amazon stock generated returns of approximately 32% per year. But for income investors, Amazon may not be an attractive option due to the lack of a dividend payment .
Should income-seeking investors buy Amazon stock?
Instead, investors should understand why the company doesn’t pay a dividend , what it does with its cash instead, how good those uses of cash really are, and whether there’s room for Amazon in a largely dividend-paying portfolio of stocks.