Are Dividends Irrelevant?

In theory, dividends are the foundation stock valuation, starting with the idea that a stock is worth the present value of all future expected dividends. That concept had to be adapted to real-world practicalities for a number of reasons one of which is that many stocks don’t pay dividends. Interestingly, though, theorists, rather than resisting have in some cases carried things so far that adaptations been allowed to have completely swallowed the original theory and suggest that dividends are actually bad.