Siemens cuts dividend by 10.3 percent in 2020
With the dividend cut announced this morning Siemens is another European company with a strong dividend history ending because of the COVID-19 pandemic. Other companies in Europe cutting or suspending the dividend in 2020 are LVMH, Anheuser Busch Inbev and oil majors including Shell and BP.
For Siemens the dividend cut comes as a surprise with the stock trading near its 52 week high. The german industrial company had raised its dividend in each of the last 6 years and did not cut its dividend for a least three decades. This will now all come to and end.
In the press release dated November 12, 2020, Siemens mentions: After the successful spin-off of Siemens Energy, Siemens proposes a dividend of €3.50 per share, consisting of €3.00 at the upper end of our targeted dividend payout ratio, supplemented by an additional €0.50
The proposed dividend of €3.50 per share yields 3.0% at a stock price of $117.52 for Siemens, a member of Germany's DAX index. At Wednesday's closing price Siemens had a market cap of exactly €100 billion.
Siemens AG is a Germany-based technology company. It operates through seven segments: Digital Industries, which offers products and system solutions for automation used in discrete and process industries; Smart Infrastructure, which supplies and intelligently connects energy systems and building technologies; Gas and Power, which offers products, solutions and services for generating electricity, for producing and transporting oil and gas, as well as for downstream and oil and gas-related operations; Mobility, which combines all Siemens businesses in the area of passenger and freight transportation; Siemens Healthineers, which supplies technology to the healthcare industry and engages in diagnostic imaging and laboratory diagnostics; Siemens Gamesa Renewable Energy, which designs,and produces wind turbines, and sales wind farms, and Financial Services (SFS), which offers leasing solutions and equipment, project and structured financing in the form of debt and equity investments.