It’s dangerous to buy headline yields — or even supposedly “safe” blue chips with more modest dividends — without looking at the profits funding these payouts. Companies with high payout ratios (how much in earnings, funds from operations and other measures a company pays out in the form of dividends) are a twofold risk: 1. High payout ratios can lead to a slowing in dividend growth, which means your payout is increasingly likely to fall behind inflation. 2. High payout ratios are often an early warning sign of dividend cuts, or even outright suspensions. Let’s call out four stocks with skyrocketing payout ratios. All four are “stay aways” – and the names may surprise you...
The Coca-Cola Co (NYSE:KO) has been building out its non-cola brands for years – including the likes of Powerade sports drinks, Simply Orange juices and Dasani water – for precisely the possibility that is reality today. Centurylink Inc (NYSE:CTL) is in the same ilk as Frontier Communications Corp (NASDAQ:FTR), which cut its dividend a few months ago, and the aforementioned Windstream, which just killed its payout outright. The nice thing about energy pipeline master limited partnership (MLP) Plains All American Pipeline, L.P. (NYSE:PAA) is that there’s not much guesswork in whether the company is going to cut its distribution. Fashion retailer Guess?, Inc. (NYSE:GES) should have cut its dividend long ago.
Source: Income Investor
- 4 High Yield, High Risk Dividend Stocks
- 5 Dividend Stocks To Buy And Hold, Not Buy And Forget
- All Investments Carry Risk
- Warren Buffett's Two Investing Rules For Dividend Investors
- Dividend Stocks vs. Dividend ETFs
________________________________________________________________
Subscribe to:
Post Comments (Atom)
Popular Posts Last 30 Days
-
The fact is that there are many interesting high-yielding companies that have good long-term prospects. Besides, as the markets get more vol...
-
A common measure of dividend sustainability is the payout ratio, the percent of earnings that are paid out to shareholders. Unfortunately, e...
-
Part of the joy of investing is seeing your good investments continue to grow, years after your initial purchase. Aside from the financial s...
-
Some investors — usually referred to as income investors — specifically set out to buy securities that pay them even before stock price appr...
-
A lot changes when you shift from working to retirement, including how you invest. Most investors switch from building a nest egg to living ...
-
Good income investments often come with strong dividend yields, delivering income that's higher than an investor could find at a bank or...
-
Last month we wrote about the top four companies in our model portfolio in the article 4 Dividend Dominators for 2021 - Companies With More ...
-
Both of the listed stocks are often discussed on the Reddit page, and for very different reasons. The former pays a frequent special dividen...
-
When it comes to dividend stocks, investors can fall into the trap of focusing on dividend yield over all else. That can be a dangerous stra...
-
Safety and tranquility are both important aspects of investing for retirement. Yes, we want stocks with meaningful upside. We also -- howeve...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.