I looked through some of the old Dow Jones stocks for a project I'm working on and found some inconsistency with JNJ stock. For a share price of $1.66 they appeared to pay $0.42 in quarterly dividends which would more than double any money put into the stock within a year. See Yahoo Finance

By simply investing $10k into the stock every year, the investor would have $5 billion in 45 years. Is this correct or is this a mistake? If so what happened to a Dow Jones listed company that they could afford dividends like this? Or am I just reading it wrong?

2 Answers 2


No, your billionaire premise is not correct.

Most people don't realize that share price drops by the exact amount of the dividend on the ex-dividend date when the stock exchanges adjust the closing price.

If you have a $100 stock that is going ex-dividend tomorrow morning for $1, in the morning the adjusted close will be $99. IOW, you will incur a capital loss in the amount of $1 while becoming entitled to receive your $1 dividend on the Pay Date. For that reason, you would not be doubling your JNJ money in one year after receiving four dividends. In fact, an ex-dividend results in zero increase or decrease in the value of your position.

When a stock splits, the number of shares increases and the price decreases, per the nature of a split. If you own 100 shares of a $100 stock and it splits two for one, on the day of the split you will own 200 shares at $50. In both cases, your position value is $10k.

My guess is that Yahoo Finance is reporting split adjusted stock prices (many of them over the years) but it did not adjust the dividend as well, making it appear that JNJ paid a 100% dividend back then. Yahoo is not a rock star when it comes to reliability :->)

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    Yes, but it is unfortnately the only place on the entire internet where I can get legacy finance data. Thanks though, I think I'll just kick JNJ off my stock carousel. I hope the other datapoints are more or less correct Jan 1, 2020 at 21:30
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    If the JNJ data is bad because Yahoo is not adjusting the dividend then any other data from Yahoo that paid a dividend is likely to be bad. You can verify my guess about this being the cause by looking up the dates of stock splits and looking up the historical dividends for a stock. With that info, you'll be able to determine if Yahoo is making the error that I suggested. How much data are you looking for? How many years? Daily, weekly, monthly? How many stocks? Jan 1, 2020 at 21:54
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    Its just for a data visualization project, mainly about how to use d3. I think I'll even work this error into the presentation to show how unverified data is unlikely to be trusted. But for a bit of stock data to fill a fancy graph it should still fit the bill Jan 1, 2020 at 22:04
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    JNJ had four dividends in 1978, each of $0.425. There were no other corporate actions in 1978 (such as stock splits, stock dividends etc.). At the time it was trading in the $70-$90 range, which is nothing like 25%. Source: US Stock database at Norgate Data. Jan 2, 2020 at 0:51
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    @user2741831 - Yahoo got the dividend right. It was .472 per quarter in 1978 and .499 in 1979. I have access to daily data back to 1980. I compared it to Yahoo's O/H/L/C and it matched. So they got the daily prices right as well. They just didn't explain that daily price was split (and dividend) adjusted but that the dividends were not split adjusted. Since 1978, they had 5 stock splits. The first was 3:1 and the next four were 2:1. If you want to adjust, divide the 1978 annual dividend by 48 and divide that by share price, say $1.65) and you get a 2.12% dividend which makes sense. Jan 2, 2020 at 2:00

JNJ did pay $0.42 per share in quarterly dividends, but the unadjusted (for splits) share price in the late 70s was $67-$80. It appears as though you're looking at share prices which are adjusted for splits and dividend per share prices which aren't adjusted for splits.

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