FYI: It has long been known that many investors have a preference for cash dividends. From the perspective of classical financial theory, this behavior is an anomaly. In their 1961 paper, “Dividend Policy, Growth, and the Valuation of Shares,” Merton Miller and Franco Modigliani famously established that dividend policy should be irrelevant to stock returns.
As they explained it, at least before frictions like trading costs and taxes, investors should be indifferent to $1 in the form of a dividend (causing the stock price to drop by $1) and $1 received by selling shares. This must be true, unless you believe that $1 isn’t worth $1. This theorem has not been challenged since.
Regards,
Ted
https://www.etf.com/sections/index-investor-corner/swedroe-dividend-growth-demystified?nopaging=1
