These 6 Companies Cannot Support Their Dividends
Looking for yield in this low interest rate environment can be dangerous, as investors search further and further afield to try and find a return that has not already been pushed down to abnormal levels. This causes problems as these yields can be extremely risky, not ideal when you're trying to defend your portfolio. So, here are six companies, which I believe are unable to sustain their dividend payouts based on cash flows.
Seadrill Ltd. (SDRL)
Share Price
EPS ttm
Dividend
Yield
Dividend Cover
$39.6
$13.6
$3.36
8.5%
4
Yielding 8.5%, Seadrill enters an elite club of high yield stocks, however, the high yield can also signifies danger. Having said that, the company's dividend payout covered 4x by earnings per share, so the company passes the first basic dividend strength test with flying colors, but how do the company's cash flows stack up? Cash Flow Statement
$US Billions
31-Mar-12... Read more