Here's Why Google Needs To Start Paying Dividends To Its Investors

Stock of tech giant Google Inc GOOGL has been on a continuous slump since the end of September last year. With growth of the company slowing down, the demand for dividends from shareholders is growing day by day.

Kevin O'Leary, chairman at O'Leary Funds, was on CNBC Tuesday to advocate why it’s time for Google to start paying dividend to its shareholders.

“I believe that all roads lead to dividend payers all of the time regardless of how much volatility is in the market because overall a long period of time that’s where 70p of the returns come from and when you start to debate stocks that provide a lot of volatility,” O’Leary said. “Let me give you an example , we are almost 20% down on Google, don’t you think it’s time that Google made itself attractive to me by providing a 2.5p dividend.”

He continued, “Then maybe now I’ll treat it as a real company, it has got lots of cash, it should started paying back and that will be a good thing for them because you want to talk about volatility, if you bought this stock six months ago, you lost 18.5p ouch!”

Can’t Google Do Anything More Productive With Its Cash?

“No, because what Google has done and why it has to come to Daddy now is I am going to be, and investors like me, will be the reason this finds a stable place in value portfolios,” O’Leary replied. “Stop investing in wow factor ideas that don’t make cash flow, start focussing on generating capital returns to your shareholder base, admit that the growth story has slowed because there is no question about that. I don’t use Google as much as I used to because there are so many other platforms. I can search what’s happening right now like Instagram or Google.”