# Special dividends and NASDAQ:AWRE



## gibor365 (Apr 1, 2011)

Was wondering if anyone is playing special dividends.... for example NASDAQ:AWRE today announced that its Board of Directors has declared a special cash dividend of $1.80 per share, or approximately $40 million in total. The special cash dividend will be paid on December 17, 2012 to shareholders of record as of December 3, 2012. 
Share price is about $6, so this $1.80 looks very attractive (about 30% yield)... They had similar special dividend $1.15 back in May 12....
Where is the catch? It's too simple buy it before Dec 3, get dividend on 17th and sell after it gaps up....

P.S. It's rated very good by Thomson Reuters : AWRE is currently among an exclusive
group of 178 stocks awarded our highest
average score of 10


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## ddkay (Nov 20, 2010)

This is tempting, I don't see the catch, let me know if you find the catch :love-struck:


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## gibor365 (Apr 1, 2011)

ddkay said:


> This is tempting, I don't see the catch, let me know if you find the catch :love-struck:


It's tempting for me too  Tomorrow price can popup, but until Dec 3 maybe it can be with reasonable price...
BTW, if I get special dividend into RRSP account, no any tax , right?


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## thenegotiator (May 23, 2012)

so tomorrow price is 7.5:biggrin:


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## gibor365 (Apr 1, 2011)

I just checked the chart when last special dividend was paid in May... it went up and than went a a little bit down, if you bought there , you got pretty decent gain...


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## thenegotiator (May 23, 2012)

buy it then.what are u waiting for?


11/13/12 RONIN CAPITAL, LLC, 
Director 1,000,000 Buy at $6.00 per share. $6,000,000


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## ddkay (Nov 20, 2010)

> Wal-Mart, could save as much as $180 million in federal income taxes after the huge retailer announced Monday that it would pay out its quarterly dividend on Dec. 27 instead of Jan. 2, as was scheduled.
> 
> The change will allow the family and other Wal-Mart shareholders to record the income this year, when the federal tax rate on dividends tops out at 15 percent. Next year, if the Obama administration and Republicans are unable to reach a compromise, that rate is set to jump sharply to 39.6 percent. High earners will have to pay an additional 3.8 percent on most investment income to help pay for the new federal health care law, bringing the total possible tax bite to 43.4 percent.


It seems like a lot of companies would be issuing special dividends before the year is over


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## gibor365 (Apr 1, 2011)

ddkay said:


> It seems like a lot of companies would be issuing special dividends before the year is over


Maybe AAPL will pay special dividends too?!


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## Homerhomer (Oct 18, 2010)

what is the attraction of special dividend? 

For example special dividend is $1 to be declared tomorrow.
Today price of the stock is $10, tomorrow the price of the stock by default is $9, and I have $1 in my pocket. How am I better off?

Let's not confuse it with dividend investing in companies who pay on monthly or quarterly basis and increase dividends periodically.


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## humble_pie (Jun 7, 2009)

special dividends paid out on US shares are usually 100% taxable in canada as other income. Although occasionally they are to be used to modify the cost base of a stock.

as a rough guide, canadian investors are often better off taxwise by selling such US shares on the day prior to the X date of a large special dividend. They will thus capture the runup in share price as tax-favoured capital gains while avoiding the heavily taxed dividend itself.


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## gibor365 (Apr 1, 2011)

Homer, I've never get or play with special dividends, this is why I publish this thread that I want to read opinions...
It's true what you are telling , but usually stock gapping up after ex-dividend date... so looking at the AWRE chart after May 15 special dividends, you could've buy and sell practically at the same price (or even more expensive) and get this huge dividend


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## Homerhomer (Oct 18, 2010)

gibor said:


> Homer, I've never get or play with special dividends, this is why I publish this thread that I want to read opinions...
> It's true what you are telling , but usually stock gapping up after ex-dividend date... so looking at the AWRE chart after May 15 special dividends, you could've buy and sell practically at the same price (or even more expensive) and get this huge dividend


It seems like cosmetics with no real benefit (like stock split), investors are happy for whatever reason but is there a reason to be excited about ? I remember once watching BNN and a savy investor called because he was terrified because his stock (I believe Weston) crashed 20% ;-), that $8 special dividend wasn't such a windfall afterwards.

On top of that like HP said you get screwed with taxes if it's paid on foreign investments.


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## gibor365 (Apr 1, 2011)

But if I get those dividends in my RRSP/LIRA would be i taxed?


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## Homerhomer (Oct 18, 2010)

gibor said:


> But if I get those dividends in my RRSP/LIRA would be i taxed?


No, there would be no witholding tax, and you wouldn't be taxed (no different than any other income inside rrsp).
You would be taxed in the margin account, and if inside tfsa there would be witholding tax that you can't claim as credit on your tax return.


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## Toronto.gal (Jan 8, 2010)

Gibor is the perpetual dividend chaser, LOL. :biggrin:


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## thenegotiator (May 23, 2012)

Toronto.gal said:


> Gibor is the perpetual dividend chaser, LOL. :biggrin:


indeed...
the divvy chaser .
divvy divvy divvy.


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