Baker Hughes Offers Attractive Dividend Yield Amid Market Trends

Understanding the Value of Dividends in Investment Strategies

In Thursday’s trading, Baker Hughes Company (Symbol: BKR) reached a dividend yield exceeding 2%, based on its quarterly payout of $0.84 annually. The stock was priced as low as $41.83 during the day. This dividend is significant as dividends have historically contributed a substantial part of the stock market’s return. For example, if you had invested in the S&P 500 ETF (SPY) on December 31, 1999, at $146.88 per share, by December 31, 2012, the value per share would have dropped to $142.41 – a decline of $4.67 over that period. However, during those same years, you would have earned $25.98 per share in dividends, resulting in a total return of 23.36%. While that translates to an average annual return of about 1.6% with dividends reinvested, a yield above 2% looks particularly attractive if sustainable. Notably, Baker Hughes is part of the S&P 500 Index, highlighting its prominent status among large-cap companies.

However, dividend amounts can be unpredictable as they often align with a company’s profit fluctuations. For Baker Hughes, analyzing the dividend history chart for BKR can provide insights into whether the recent dividend is likely to be maintained and if a consistent 2% annual yield is a realistic expectation.

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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.