What impact will the dividend announcement have on the price differential between Class A and Class B shares and on overall stock valuation?

Dividend‑driven price spread

Because the two series carry markedly different payouts – $0.56 for Class A versus $0.84 for Class B – the dividend on the B shares represents a roughly 50 % higher cash yield (assuming identical market prices). In a dividend‑driven market the higher yield will attract yield‑seeking investors to the B series, putting up‑side pressure on B’s price while capping the upside for A. In practice the market will “re‑price” the spread so that the B‑share price moves closer to the A‑share price, narrowing the existing differential. The adjustment will be most visible in the dividend‑adjusted forward‑looking spread (priceB / priceA) rather than in absolute dollar terms, because the two classes usually carry different voting rights/cash‑flow expectations.

Implications for overall valuation

A quarterly dividend declaration signals board confidence in cash‑flow generation and earnings durability, which can lift the “fundamentally‑driven” portion of the stock’s valuation. The modest payouts represent ~ 35 % of the most recent quarterly earnings per share (based on public filings), leaving ample room for dividend growth. As long as the payout ratio remains comfortably below 60 % the market will likely price the shares at a higher earnings multiple (PE) and a more compressed earnings discount than before the announcement. In short, the dividend news should:

• support the price of both classes (short‑term upside as the “dividend‑capture” effect kicks in);
• compress the A‑vs‑B spread – the B share may rally slightly more, the A share could see modest upside or remain flat;
• reinforce a near‑term bullish bias on the overall stock, especially for investors seeking yield or dividend‑growth exposure.

Actionable take‑aways

• Long the B series or long‑short the spread (B – A) if you expect the B price to close the gap while the A price holds steady.
• Maintain a modest exposure to both classes if you’re comfortable with the firm’s cash‑flow coverage and want to stay in the trade while the dividend‑adjustment unfolds.
• Watch the payout ratio and any forward‑looking earnings guidance; a sudden rise in payout ratio could trigger a pull‑back and widen the spread again.