Understand ex-dividend dates

[aim-high]

I recently came across an article regarding dividend dates. I understand that if a company pays out dividends , I need to buy the stock of the company before the ex-dividend date to be eligible for a dividend.

Taking the example of verizon stocks, I refer to this link
Verizon | Investor Relations | Stock Information | Dividend History

As you can see the last time the declaration date was Sep 03,2009 and the payment date was Nov 02 2009. I see that if I buy a stock on or after the ex-dividend date, I wont get dividends. Given this fact, If I buy verizon stocks today I am not guaranteed any dividend payments so If I really want to buy this stock for dividends, I should wait for the next declaration date, correct ?

[bjl584]

I guess it depends on whether or not you think that the stock price will go up or down, as this is also something to consider. You will receive more or less shares depending on the price of the stock at the time of purchase. The number of shares owned will effect how much you receive in dividend payments as well.

[buildmybudget]

I think you may be slightly over-complicating the dividend dates. If you want to purchase a stock because you anticipate a good dividend yield and capital return, then you should buy the stock. Once you buy it, you will then own the stock when it arrives at the next ex-dividend date and subsequent declaration date and thus receive the dividends.

It's really very simple, actually. You just can't expect to receive dividends if you haven't purchased the stock before the ex-dividend date. So if you want dividends, buy the stock and you'll get the next quarterly dividend.

[GrimJack]

Stock prices generally reflect the dividend - you will see the value of the shares will vary around the ex-div date that takes the dividend into account.

[Slug]

Stock prices generally reflect the dividend - you will see the value of the shares will vary around the ex-div date that takes the dividend into account.

Yes, careful buying right before the dividend is paid. Could get hit with a little dip that instead you could take advantage of.

[TermMonster]

In theory, the market instantly recognizes the enterpise value of the dividend paying company will decrease by exactly the declared dividend. However, as we all know, theory is far from practice. In my experience, large cap names align more closely with theory than mid and small cap names. Therefore, while there should be no advantage to buying a stock ex-dividend there are often price moves that suggest otherwise. Only buy a stock if you think the company is undervalued relative to the current market price.