Oracle Blazes a Unique Path Around the Fiscal Cliff
Dec 5th 2012 7:45PM
Updated Dec 5th 2012 7:48PM
With the fiscal cliff looming large, dividend checks might get taxed at a higher rate next year. Lots of companies have moved payouts from early 2013 to late 2012 in an effort to mitigate these higher taxes.
For example, health care information handler Quality Systems bumped its Jan. 4 payment date to Dec. 28 without changing the amount or record dates. Networking giant Cisco Systems scheduled the next payout for Dec. 19 to begin with -- no need to move anything around. That announcement was made just a week after the election.
Others prefer to simply add a special dividend to the payout schedule. AOL, for one, will send you $5.15 per share on Dec. 14 if you own the stock at today's close of business. This from a company that doesn't even have a regular dividend policy to defend.
Some might say that Apple should join the party with a huge one-time payout before the end of the year, but Cupertino hasn't sent any signals of favoring that idea. The company has bigger fish to fry, like fighting off the Android assault and defending its profit margins through the holidays. Dividend wizardry will just have to wait.
And then there's Oracle . The enterprise software expert always marches to its own drummer, and is setting a whole new standard in the dividend race as well.
There's no special dividend on tap, nor any rate boosts. Instead, Oracle decided to accelerate the next three dividend checks to Dec. 21, payable to investors of record as of Dec. 14.
The board won't discuss any other dividend moves until next August, so don't expect any bonus payments on top of this hurried triple payment. Not one penny of extra cash is leaving Oracle's pockets. It's all about directing the money flow to shareholders rather than tax collectors. CEO Larry Ellison was reportedly not involved in the accelerated payment discussions, but he is the company's largest shareholder (with a 23% stake in the company) and stands to benefit immensely from the decision if capital gain taxes indeed rise next year.
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The article Oracle Blazes a Unique Path Around the Fiscal Cliff originally appeared on Fool.com.Fool contributor Anders Bylund holds no position in any company mentioned. Check out Anders' bio and holdings or follow him on Twitter and Google+. The Motley Fool owns shares of Cisco Systems, Apple, and Oracle. Motley Fool newsletter services have recommended buying shares of Apple and Quality Systems. Motley Fool newsletter services have recommended creating a bull call spread position in Apple. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days .
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