A Dividend Cut Might Actually Be an Opportunity

There is a great deal of belief by many that when a company cuts its dividend that the shares should be sold. That, at least to me, ran counter to my experience of 30 plus years of trading under my belt. More often than not, when bad news is announced after a long and lengthy decline, that event often pinpoints the climatic end of the decline marking a excellent buying area. Conversely, the time to sell a stock is often after the good and expected news is released. Selling shares is more likely to be viewed as a trading opportunity due to stocks' natural tendency to rise year to year. Now, I understand an income investor wishing to sell the shares as it no longer produces the desired income. But, might it also be the right time to buy the shares for appreciation, as well as future dividend income as... Read more