Cash dividend payments slow

Corporate America turned stingier with cash dividend payments to shareholders in 2007.

The number of companies raising dividends totaled 1,857 last year, down 5.7% from the 1,969 that boosted payments in 2006, data tracker Standard & Poor’s said Thursday.

That marked the first year-to-year decline since 2001.

Heavy mortgage-related losses led to dividend cuts by some companies in the financial services sector, which traditionally has been a dependable source of rising dividends.

Mortgage giant Freddie Mac, for example, slashed its quarterly dividend in half in December, to 25 cents a share. Pasadena-based lender IndyMac Bancorp also cut its dividend 50% in the fourth quarter.

Still, many big-name firms rewarded shareholders with bigger cash payments. AT&T; Inc. raised its dividend 13% in December, to a quarterly rate of 40 cents a share. Nike Inc. boosted its quarterly dividend 24% in November, to 23 cents a share.

Many companies continue to favor stock buybacks at the expense of committing to bigger dividends, said Howard Silverblatt, an analyst at S&P; in New York. Buybacks can help support a company’s stock price in the market, but they give cash only to shareholders willing to sell stock.

The second quarter of last year, the latest period for which buyback figures are available, marked the seventh consecutive quarter during which S&P; 500 companies spent more than $100 billion to buy back shares, Silverblatt said.