Thursday, June 10, 2021

Happy Microsoft Dividend Day

Microsoft (MSFT) is a dividend achiever, which has managed to increase dividends regularly since initiating a dividend in 2003.

Today, it distributed its regular quarterly dividend of 56 cents/share to qualified shareholders. If you own 100 shares, you would have received a quarterly dividend of $56, which is a nice amount of pocket change.

The company's founder is Bill Gates, who launched it in 1975 with Paul Allen. The company grew by leaps and bounds, and was eventually take public in 1986.

Bill Gates received a check for $$57,676,043.04 , given that he owned shares according to the last proxy filed in 2019.

Of course, Bill Gates is a major philanthropist, which is the reason why he has been gradually reducing his ownership stake in the Seattle-based software company. He has also been diversifying his wealth away from Microsoft for the past 35 years.

At the time Microsoft went public, Bill Gates owned 11,222,000 shares, which represented 49% ownership in the stock according to the prospectus.

If he had held on to his shares, and just spent all dividends, he would have 3,231,936,000 shares after the 9 stock splits between 1987 and 2003.

These shares would be worth close to $766 billion, and be paying a quarterly dividend of $1,809,884,160.

That's $1.8 billion in dividends every single quarter, or roughly $229.56 in dividend income every second.

These are huge numbers, and just illustrate the power of compound interest and the power of identifying a great company early on, and sticking to it. Not every company does that well. Microsoft has had its share of ups and downs throughout its history.

I just find it fascinating that Bill Gates would have been richer than most folks out there. 

But of course Bill Gates realized that building wealth is not as important as making a difference with all that wealth. At the end of the day, making a real difference in the world is much more important to his legacy, than becoming the first trillionaire.

Sadly, with Mr. Gates divorce proceedings, it may be harder to estimate future dividend income from his Microsoft stock. It is likely that it will be reduced going forward.

1 comment:

  1. Great articles and comments! Nice to read you! Thanks!
    Rgds
    Eduardo from Argentina

    ReplyDelete

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