Geraldine Weiss on Lies and Dividends

A clever accountant can make earnings appear good or not so good, depending on the season or the objective. There can be no subterfuge about a cash dividend. It is either paid or it is not paid.
— Geraldine Weiss

Corporate storytelling often begins with earnings. Pages of pro forma adjustments invite us to imagine profitability that may or may not endure. But Geraldine Weiss chose to judge companies by the relationship between their dividends and their share prices.

Weiss was an American editor, investment advisor, and investor. In 1966, she became the first woman to found a popular investing newsletter, Investment Quality Trends. (Weiss passed away in 2022, but her successor continues to publish.)

For years, Weiss had to sign her newsletter "G. Weiss" so sexist readers wouldn't know she was a woman. Later, she was lauded as "the Grande Dame of Dividends." Weiss was a low-tech investor who considered the pocket calculator “the greatest invention of all time.”

Borrowing from Benjamin Graham, Weiss expected the crowd to lose interest in sturdy blue chips whenever something flashier grabbed the spotlight. Investors would neglect dividend-paying blue chips. Their prices would sag, and the percentage yield their dividends offered would climb.

This is how Weiss's famous “Lucky 13” list emerged. She added stocks to this basket of dividend stalwarts when their price-to-dividend ratio fell below each company's historic levels.

Between 1986 and 2022, the “Lucky 13” compounded at 11.8% per year, compared to 11% for the Wilshire 5000 Total Market Index. That success is the basis for Weiss's most famous line:

“Dividends don’t lie.”
— Geraldine Weiss

Weiss's book, Dividends Don’t Lie, distills this logic into a method that has outlived the era of ticker tapes and printed newsletters. Unfortunately, no digital edition exists, but you can still buy a paper copy.

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