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S&P 500 Companies That Don't Pay Dividends

Stoyan Bojinov Dec 16, 2014


[Updated August 3, 2017]

Dividend investing has earned a spot in countless portfolios as prudent investors of all walks embrace the value of a reliable income stream. Every so often dividend investors are left frustrated for a good reason – the stock they want to own doesn’t pay a distribution. At the end of the day, dividends are great but not everyone pays them [see our Best Dividend Stocks List].


As such, below we examine the 80 securities in the coveted S&P 500 Index that currently do not pay out a dividend to shareholders, but may potentially start to based on a combination of several important factors.


S&P 500 Companies that Can Afford to Start Paying a Dividend


Nobody has a crystal ball when it comes to predicting when a firm might initiate its dividend policy. With that being said, there are some signposts that could hint as to which companies might be best positioned to start paying out a distribution [see The Ten Commandments of Dividend Investing].

Starting with the table below, we narrowed down the list of S&P 500 stocks that don’t pay a dividend, but could theoretically afford one, based on three simple, but insightful, valuation metrics:

  1. The company’s average sales growth over the past five years must exceed 10%; this criteria eliminates very young companies as well as firms that may be struggling to capture a meaningful market-share in their respective lines of business.
  2. The company’s debt-to-equity ratio must not exceed one; this criteria narrows down the list to include only those firms that are in sound financial positions and are not burdened by interest payments on their debt holdings.
  3. The company’s profit margin must exceed 20%; this criteria ensures that the firm can generate a steady cash flow stream from operations that would be used to pay out a distribution.


Based on the criteria outlined above, the S&P 500 companies that could potentially afford to start paying a dividend are:

  • Biogen Inc. (BIIB)
  • Facebook Inc. (FB)
  • Alphabet Class C (GOOG)
  • Alphabet Class A (GOOGL)
  • Intuitive Surg Inc. (ISRG)
  • Monster Beverage Cp (MNST)
  • Verisign Inc. (VRSN)
  • Waters Corp. (WAT)

Use the Dividend Screener to find high-quality dividend stocks based upon 16 parameters. You can even screen stocks with DARS ratings above a certain threshold.


List of All S&P 500 Companies with No Dividend


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