Clearway Energy Inc. Signals Potential for Dividend Run Ahead
This morning, a “Potential Dividend Run Alert” was issued for Clearway Energy Inc (NYSE: CWEN) through our Dividend Alerts service. Let’s delve into the specifics behind this alert.
Understanding Dividend Runs
What exactly is a “Dividend Run”? This concept was first introduced to us at a ValueForum conference. To clarify, we need to explore how a stock behaves around its ex-dividend date.
The ex-dividend date is the trading day after which any buyer of the stock is no longer eligible to receive the upcoming dividend. Therefore, to qualify for the dividend, shares must be purchased **before** this date. Typically, the stock price is expected to drop by the dividend amount on the ex-date, given that all other factors remain constant. If the price did not drop, it would mean buyers are effectively paying more for the same shares post-ex-dividend.
The Anticipation Before Ex-Dividend Date
If a stock is expected to drop on the ex-dividend date, it follows that its price may rise beforehand. Investors anticipate the dividend, creating pressure for a potential Dividend Run. If dividend-paying stocks only fell without rebound, they would eventually lose value, which contradicts the purpose of a company that consistently generates revenue and pays dividends.
Strategies for Dividend Investing
Investors take varied approaches when capturing Dividend Run effects. Some buy shares shortly before the ex-dividend date, hold until the dividend is paid, and then sell. Others may opt to sell the day before the ex-date to maximize capital gains. Commonly, one strategy involves purchasing approximately two weeks (or ten trading days) ahead of the ex-dividend date.
Real-World Example: CWEN
For instance, the 0.431/share dividend for CWEN went ex-dividend on 03/03/25. On the last trading day prior, the shares closed at 28.02. Two weeks earlier, on 02/13/25, shares closed at 26.28. This indicates an increase of 1.74 over the two-week period leading up to the dividend payment.
Historical Performance of CWEN Dividends
Analyzing the last four dividends paid by CWEN, this strategy yielded capital gains exceeding dividends in three of four instances, achieving a total run gain of +4.75. This amount surpasses the total dividends paid over that period, which amounted to 1.682. Below is the data:
| Ex-Dividend | ——Price 2 Weeks Prior—» | ——Price 1 Day Prior—» | Run Gain/Loss | |||
|---|---|---|---|---|---|---|
| 03/03/25 | 0.431 | 02/13/25 | 26.28 | 02/28/25 | 28.02 | +1.74 |
| 12/02/24 | 0.424 | 11/14/24 | 27.36 | 11/29/24 | 29.49 | +2.13 |
| 09/03/24 | 0.417 | 08/16/24 | 28.99 | 08/30/24 | 28.96 | -0.03 |
| 06/03/24 | 0.41 | 05/16/24 | 27.09 | 05/31/24 | 28.00 | +0.91 |
| Div Total: | 1.682 | “Divvy Run” Total: | +4.75 | |||
Upcoming Dividend Information
In about two weeks, Clearway Energy Inc (NYSE: CWEN) will go ex-dividend for its latest dividend of 0.438/share.
- Upcoming Dividend: 0.438/share
- Ex-Div Date: 06/02/25
- Payment Date: 06/16/25
- Dividend Frequency: Quarterly
While past performance does not guarantee future results, Clearway Energy has demonstrated a strong history of dividend performance, making it an important stock for dividend-focused investors.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
