Polaris Inc: A Look at the Dividend Run Ahead
This morning, our DividendChannel.com service issued a “Potential Dividend Run Alert” for Polaris Inc. (NYSE: PII). Let’s dive into what this could mean for investors.
Understanding the Dividend Run
But what exactly is a “Dividend Run”? This intriguing concept, first introduced at a ValueForum conference, provides insights into stock movements surrounding dividend dates.
Decoding the Ex-Dividend Date
The ex-dividend date is crucial; it’s the day buyers of the stock will not receive the upcoming dividend. To benefit from the dividend, shares must be purchased before this date. Typically, stock prices drop by the amount of the dividend on the ex-dividend date. For instance, if a stock pays a $0.67 dividend, it’s expected to drop by that same amount. This prevents buyers from effectively overpaying for the shares.
Expectations Before the Dividend
If the stock is anticipated to drop on the ex-dividend date, shouldn’t it rise beforehand? Certainly! If a dividend stock continued to fall each time it paid a dividend, it could eventually reach zero—unlikely for a profitable company. Therefore, there generally exists a “pressure” for the stock to appreciate before the dividend payment, resulting in a potential Dividend Run.
Timing Strategies Among Investors
Diversified strategies among investors lead to different timing for capturing potential gains from a Dividend Run. Some prefer quick trades on specific dates, while others may utilize dollar cost averaging. Another common approach is to buy shares a few weeks before the ex-dividend date, hold for the dividend, and then possibly sell afterward. Conversely, some investors sell just before the ex-dividend date to maximize capital gains.
Practical Example of PII’s Dividend History
Take, for example, the $0.66 dividend from PII that went ex-dividend on 12/02/24. On 11/29/24, shares closed at $69.00—the last day buyers would receive that dividend. Two weeks earlier, on 11/14/24, shares priced at $67.20. In this two-week period, shares appreciated by $1.80.
Historical Insights on PII’s Dividends
A review of PII’s last four dividends shows that this strategy led to greater capital gains than dividends in three out of four instances, accumulating a total gain of $6.56 compared to the sum of dividend payments at $2.64. Here are the details:
| Ex-Dividend Date | ——Price 2 Weeks Prior—» | ——Price 1 Day Prior—» | Run Gain/Loss | |||
|---|---|---|---|---|---|---|
| 12/02/24 | 0.66 | 11/14/24 | 67.20 | 11/29/24 | 69.00 | +1.80 |
| 09/03/24 | 0.66 | 08/16/24 | 82.74 | 08/30/24 | 84.65 | +1.91 |
| 06/03/24 | 0.66 | 05/16/24 | 83.82 | 05/31/24 | 83.60 | -0.22 |
| 02/29/24 | 0.66 | 02/13/24 | 89.79 | 02/28/24 | 92.86 | +3.07 |
| Total Dividends: | 2.64 | “Divvy Run” Total: | +6.56 | |||
In just under two weeks, Polaris Inc (NYSE: PII) will become ex-dividend for its latest dividend of $0.67 per share. Will the history of Dividend Run repeat?
Upcoming Dividend Details
Upcoming Dividend: $0.67/share
Ex-Div Date: 03/03/25
Payment Date: 03/17/25
Dividend Frequency: Quarterly
Full PII Dividend History »
The Bottom Line
While past performance does not assure future outcomes, Polaris Inc stands out as a noteworthy option for investors seeking dividend opportunities, with an implied annualized yield of 5.95%.
Stay updated on potential Dividend Run opportunities, and to receive quick email alerts, consider signing up for our free Dividend Alerts feature at DividendChannel.com.
Also see:
• Highest Yield Preferreds
• BSBR Options Chain
• TAC Price Target
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
