Dividends4Life: Dividends in Danger? Sysco

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Dividends in Danger? Sysco

Posted by D4L | Friday, May 27, 2011 | | 0 comments »

The consensus on Sysco seems to be that its dividend is not in great danger, but that it bears watching because of the effects of rising food costs. Sysco’s F3Q report on May 9 put some minds at ease, as the company beat consensus estimates, and its price surged over 10% on the day of the announcement. The company achieved its results with higher prices and volume, but it also reported that costs had risen amid higher food and fuel expenses.

Sysco derives most of its sales from the restaurant industry, and higher costs are squeezing many food-related companies.
Sysco is on a 41-year streak of increasing its dividend, with its last increase in January of 4%, so it is nowhere near being overdue for an increase. Its next dividend payment would normally be made in July, and if it follows its practice of recent years, that dividend declaration will be made shortly.

Source: Seeking Alpha

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