Does Adobe Pay Dividends?

Last Updated on 10/27/2020 by GS Staff

Q: Does Adobe pay dividends to shareholders?

No, Adobe (ADBE) does not pay dividends. In regard to the company’s dividend policy, the most recent annual report states the following:

We do not anticipate paying any cash dividends in the foreseeable future.

Adobe 2019 Form-10K

You should not invest in Adobe to receive dividends at this time. There is presently no indication that the company will issue dividends. This, of course, does not rule out the possibility of Adobe paying dividends in the future.

The last time Adobe paid a dividend was the first quarter of 2005. The quarterly cash dividend at this time was $0.0125 per share. The company switched to repurchasing stock instead of paying dividends after the first quarter 2005 dividend was paid.

Adobe’s Stock Repurchase Program

The most recent stock repurchase program was approved by the Board of Directors in May 2018. This allowed for $8 billion in common stock repurchases up until the end of the fiscal year 2021. As of August 28, 2020, $2.05 billion remained under the May 2018 repurchase authority.

The below chart shows Adobe’s share repurchase activity over a recent five year period.

ADBE Stock Buybacks (Quarterly) Chart

ADBE Stock Buybacks (Quarterly) data by YCharts

If repurchases are timed correctly to purchase the company’s stock when undervalued, repurchases can be much more beneficial to shareholders than dividends. Adobe’s stock price chart below shows that many of the past repurchases have been nicely timed and have contributed to the stock’s increase during the five year period.

ADBE Chart

ADBE data by YCharts

We believe that many shareholders are happy with the repurchases over using cash flow for dividend payments. However, this might not always be the case if Adobe repurchases shares that are overvalued. Undoubtedly, share repurchases are much more tricky to get right compared to the steady payments of dividends to shareholders.

5 Dividend Tech Stocks

Keep in mind that many technology companies do not pay dividends. Alphabet Inc. (Google), Amazon, Facebook, and Twitter are all examples of tech companies that do not pay shareholders dividends. However, here are five companies that pay generous dividends above 2% that you might consider for further research for investment:

CompanyForward Dividend YieldForward Dividend
Texas Instruments (TXN)2.80%4.08
Cisco (CSCO)3.82%1.44
Intel (INTC)2.83%1.32
International Business Machines (IBM)5.81%6.52
Qualcomm (QCOM)2.06%2.60

As of 10/27/2020

Image Credit – Jennysarah295