I think that there is NO doubt that AOD will cut the dividend, my guess is to 10 cents, but possibly as low as 6 cents.
My reasoning: 209.1MM share outstanding at CURRENT $2.16/shr/yr= $452MM of dividends they need to earn to keep current payout.
AOD NAV is currently: $1.4 Billion ($6.80 x 29.1MM shrs)
If AOD puts the max 80% of the portfolio NAV into the dividend rotation strategey then $1.1B would have to earn $452MM or a 40% return.
Say they can capture 6 Divvies, so the average div is 40%/6 or 6.6%----if they are capturing 4 divvies in rotation then the avg yield is 10%: Too high an assumption in either case, not to mention that increasing the Dividend recapture percentages is RECKLESS in a foreseeably down market (again Imo), because the necessarily high turnover causes constant realized losses.
AOD has already liquididated another $1.5B in NAV since June 30. They only have $1.4B left to invest.
Disclosure: I follow this position for my Dad who owns at initial offering price...have advised to sell multiple times, but he loves getting a monthly divvy and refuses ...$14 of disintigrated NAV and I still can't convince him to sell.
What you're missing is that special dividends can do wonders. They will be playing the TWC special of 8.00 coming within the next couple of months, per Jill on one of the recent calls. Depending on how many shares they buy and what other specials they pick up, they will be ABLE to keep the dividend at .18. My guess is that they will do that, despite the effect on NAV from capturing specials.
On Monday, I had a chat with another AOD rep. He said the divvy would be announced within two weeks, and, when pressed, was equivocal about a cut, citing market turbulance. He "invited" me to sit in on the scheduled conference call.
Of course, he is not a manager, and it is unclear whether he's basing his remarks on corporate scuttlebutt or inside track information or what.