That may all be well and good. And people know this. And people see all this happening. That is why, before the dividend cut, the stock price will be way, way down. At the time of the dividend cut, or really the announcement of the dividend cut, all the bad news will essentially be out and reflected in the stock price. Which is why the theory is that it is a good time to buy. You are playing checkers with your statement of the facts. We dividend cut buyers are playing 4d chess based on what people will be doing based on those facts.
Company reduces dividend, gets over sold...
- Thread starter Cabin111
- Start date
That may all be well and good. And people know this. And people see all this happening. That is why, before the dividend cut, the stock price will be way, way down. At the time of the dividend cut, or really the announcement of the dividend cut, all the bad news will essentially be out and reflected in the stock price. Which is why the theory is that it is a good time to buy. You are playing checkers with your statement of the facts. We dividend cut buyers are playing 4d chess based on what people will be doing based on those facts.
It will likely take years for a company to turn around and prospects could get worse then better. I suspect the stock will actually be overvalued because all you 4d chess players will be overpricing the turnaround.
hows T doing?
Edit: just checked. You lost your queen and two bishops.
hows T doing?
Edit: just checked. You lost your queen and two bishops.
If what you said is true, again, it's already reflected in the stick price. Again, the dividend cut date is a good day to buy because everyone knows what you are saying and it's reflected in the stock price.
That's checkmate, nate.
That's checkmate, nate.
When you hit a recession, many of these companies will reduce their dividend. You just need to pick and choose the ones you want to research. Find one or two (three or four) you want, that are priced right...Then make your move.
Got the below off the net...
Nearly 75% of the stocks in the S&P 500 pay a dividend, and the dividend for many of them exceeds the yield on U.S. 10-year Treasury bonds (currently around 3.2%). Sep 8, 2022
Got the below off the net...
Nearly 75% of the stocks in the S&P 500 pay a dividend, and the dividend for many of them exceeds the yield on U.S. 10-year Treasury bonds (currently around 3.2%). Sep 8, 2022
If what you said is true, again, it's already reflected in the stick price. Again, the dividend cut date is a good day to buy because everyone knows what you are saying and it's reflected in the stock price.
That's checkmate, nate.
look at T stock. It’s probably the most prominent dividend stock in the US. How’s it going. Are you sure you are the right color on the board?
Look at XOM two years ago. Look what they did to keep the div. cutting a div is like selling a lung on the black market. Don’t bet on that guy to run a marathon.
Just looking at T...I own some of it. I also own some T-Mobile.
T-Mobile has doubled over the years. It has taken market share from T and VZ. People are dropping their landlines in droves. T has 172,000 full time employees...Most are unionized.
I used to work (subcontractor) for Worldcom at a call center. Worldcom is no more!! How data is used changes and evolves over the years...Natural gas (basically), does not!
I use to own some XOM...It got called away in a couple covered calls. I made pretty good money. If you look at the 5 year chart, it has continued to do pretty well. It has over a 4% dividend and a PE under 10!! My type of company...
LOL, come on man, first of all I already explained I'm not talking about dividend cuts by companies that are going to complete shit. I posted an example of dividend cuts I am talking about earlier in this thread. Secondly, are you really going to cherry pick certain dividend cut stocks? I'm going to be big dollars I could cherry pick some where dividends were cut and stocks came back bigly. But ain't nobody got no time for that. Without back testing we are just wasting time typing words.
I wouldn't call boeing thriving. It's approaching its covid low as airlines are still not ordering planes.
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Can you show one real world example? I have never seen one where the company has cut their div and the stock has done well within a quarter or two afterwards.
I gave you one. It wasn't cherry picked. It happend to be one that I was following around when they cut their div (i had the same thought as you do now).
I'll give you another: XOM was in trouble in 2020 early-2021. They did everything BUT cut the dividend. Think about that. Why did XOM cut billions in R&D and Capex costs and not touch their dividend? They forwent their future to preserve their dividend today.
In the real world a company cuts it's divs when it is going to shit. It's the last resort to shore up capital. And often by then the bleeding is so bad they can't continue paying it anyway.
Can you post a real world example of a company cutting it's div that saw a improvement in the short term afterwards (we can define a short term bounce as being 6 months)? And we should ignore companies whose prospects changed because their industry had a massive pop (like XOM did with commodity inflation).
