Never Look a Gift Dividend in the Mouth

Sometimes a cash rich company will declare a special one-time dividend to eliminate surplus cash. These special dividends are generally ignored when evaluating a company's dividend growth performance. The situation is more complicated when a company distributes the excess cash via its regular dividend. Often, this leads to a situation where a company appears to have a dramatic increase in its dividend, then followed by decrease in the following year. Consider the following two companies:

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