Not only are your dividend payments reduced, but also stock values fall well
ahead of the dividend cut, and often fall even further immediately following the announcement.
Just as the smart dividend investing approach uses research to predict deteriorating fundamentals
ahead of dividend cuts or suspensions, the same approach can uncover the best stocks that show improving fundamentals for dividend growth.
Not exact matches
Typically, a
dividend stock that
cuts its
dividend first displays multiple warning signs well
ahead of the actual reduction.
I'm getting a little
ahead of myself, but RSO
cut it's
dividend from 20 cents per share to 16 cents.
I am not really sure there was much we could have done to flag this
dividend cut ahead of time since management's decision to reduce the
dividend had little to do with the company's actual fundamentals (e.g. payout ratios, earnings growth, balance sheet,
dividend longevity etc.).