Why Salesforce Stock Bumped Almost 3% Higher Today

Key Points

• The company isn't wavering from its dividend policy.

• Salesforce declared a fresh quarterly payout Thursday night.

• 10 stocks we like better than Salesforce ›

Customer relationship management (CRM) titan Salesforce (NYSE: CRM) was walking tall as the trading week came to an end, with a share price gain of nearly 3% on Friday. The company hasn't been shy in sharing its profit with investors, and on its latest dividend announcement, folks piled into the stock. That gain looked quite encouraging when compared to the S&P 500's (SNPINDEX: ^GSPC) 0.3% slide.

It's payout time

After Thursday's market close, Salesforce announced that its board of directors had declared said quarterly dividend. This is just under $0.42 per share, which will be paid on Oct. 9 to investors of record as of Sept. 17. At the most recent closing stock price, it yields slightly under 0.7%. That's below the nearly 1.2% average of all S&P 500 index stocks.

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Image source: Getty Images.

Although the yield is light, it's still somewhat atypical for a tech company to pay a dividend -- usually, at least in their early to middle stages, software developers tend to plow much of their profits back into the business.

For Salesforce investors, a regular dividend payment is still something of a novelty. The company launched its payout in March 2024, when it launched with a $0.40-per-share disbursement. So far, management has only raised it once; it did so back in April, to the current level.

Adding to the bullish buy thesis

Yet receiving even a small dividend is better than earning none at all. Plus, a regular dividend payout signals to investors that a company's underlying business is healthy and generating sufficient cash for such an activity. I don't feel the dividend for Salesforce is make-or-break, but it's sure nice for shareholders to get a few coins in their pockets.

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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Salesforce. The Motley Fool has a disclosure policy.