There has been much written on the budgeted dividends NTEK expects to be able to pay during this calendar year. Unfortunately, there seem to be some misconceptions as to when we will receive the money. By way of explanation I would offer the following:
1. Date of Declaration. This is the date the BOD says the shareholders are going to be paid a dividend. NTEK has not yet declared a dividend (it’s been budgeted, but not declared). When this step is taken, the dividends become liabilities of NTEK and legal obligations due the shareholders (whoever they may be on the “Record Date”). This date is always before the following dates.
2. Record Date. If you own the stock on this date you are entitled to the dividend.
3. Ex-Dividend Date: This is generally 3 trading days prior to the “Record Date” to allow the TA to determine who is entitled to be paid.
4. Pay Date: We get the money into our brokerage accounts – usually after the close of business. (This does not include any s/h who may hold actual stock certificates. They will receive paper checks or direct deposits to their bank account). This is usually 1 – 60 days after the Declaration Date, but may be 8-9 months after Declaration.
Although many companies declare dividends at about the same time that they announce quarterly earnings, it is not required. Dividends can be declared by the BOD at any time they determine the company has the ability to pay them. So, since Lorraine (NTEK IR) has written me that NTEK will be announcing its quarterly results on April 15th, they can declare dividends at any time, but probably near that date and payable within 30 – 40 days thereafter. But, until the BOD declares a dividend, nothing happens.
If NTEK is declares this year’s budgeted dividends, they will be paying at a rate of 2.63% based on today’s closing price of $.10. If NTEK goes to $.25 per share the dividend rate would still exceed 1% - better than a savings account and capital gains too. Go NTEK. Declare the dividends. GLTA
