We’re almost three months into this crisis and three things are crystal clear:
- Plenty of “household-name” dividend-payers are in big trouble—and not just the ones you see in the news. When the payout cuts come, the resulting share-price drops will crush the unwary.
- Way too many people are clinging to blue chips yielding 2% or 3%. But is such a small payout worth it when you can lose that much in a single trading session?
- We can’t trust any stated yield until we verify a company’s cash flow.
This may sound a bit alarmist, but imagine if I told you in January that by mid-May, Ford (F), General Motors (GM), Walt Disney (DIS) and Las Vegas Sands (LVS) would have all either eliminated or, in Disney’s case, delayed their dividends.… Read more