Free Cash Flow (Earnings plus Depreciation Expense minus Capital Expenditures) almost is twice the FTR dividend. They get to depreciate all the new wireline assets they just bought from Verizon for the next 30 years. So the answer to your question, ibmwatcher, unless they screw up the integration of the Verizon wirelines they just bought, is a long time.
It is possible to screw up a major acquisition (see Fairpoint), but the Verizon lines are a much better fit into the Frontier network, they have less new software to develop from these lines, and the FTR management appears to be deeper and more ready for the integration.
Depreciation, and, Capital expenditures are not CASH. A good
article on Yahoo Financial: Dividend Companies are borrowing
to pay dividends. WHY? Their Cash Flow and Profit Margins
cannot justify the Dividend Payout. Therefore, increasing
debt was their Solution. Short-minded. Do you smell some more ENRONS.
I have never shorted any stock. But, I was following FTR
to see if was a good long term investment. After, doing
DD - my opinion is no. One reason(may have mentioned before) was the FTR balance sheet. 36-40% of Assets being displayed
is Goodwill. I do not care how it was calculated. A big red
flag - in my opinion.
Keep in mind also that past performance reports for FTR may not accurately reflect future results. On July 1, 2010 FTR acquired approx five million landlines in fourteen states from Verizon. This is said to have tripled the size of FTR. The integration process is probably underway and may involve some risk and cost, but it was also reported that huge untapped growth possibilities for FTR may also exist. I have not yet seen a detailed report on future earnings that takes all of these factors under consideration. If anyone out there has seen one, a posting would be appreciated.
I see that but the price of the shares went down from about $14 to $8 during that same period. I am also bothered by the large amount of good will on the balance sheet. They are paying a lot more than book value for the assets they're buying, obviously. Maybe they can extract a lot of cash from them--but I remain to be convinced.
It is today. You can find those numbers in Yahoo down the right column under key statistics Dividends & Splits
Forward Annual Dividend Rate4: 0.75
Forward Annual Dividend Yield4: 9.10%
Trailing Annual Dividend Yield3: 0.94
Trailing Annual Dividend Yield3: 11.50%
5 Year Average Dividend Yield4: 9.40%
Payout Ratio4: 233.00%
Dividend Date3: Sep 29, 2010
Ex-Dividend Date4: Sep 7, 2010
Last Split Factor (new per old)2: 91:16
Last Split Date3: Aug 28, 1998
Sorry, but you can not depend 100% on Yahoo's dividend date to be accurate. I believe they add 90 days to the last dividend date to estimate the next dividend date. Since some months contain 31 days and because of weekends, their estimated dividend date is often off by a day or two.
FTR's next dividend date is today, 9/30/10, not 9/29 as Yahoo stated. To get the precise dividend date for any company, you have to go to their press release for it. Here is the one from Frontier about this quarter's payment. http://finance.yahoo.com/news/Frontier-Communications-bw-3914099545.html?x=0&.v=1
There is a website "DividendInvestor.com" that is free and gives you the dates you need for any of your stocks. I've found it both useful and reliable. I have it in my favorites and utilize it often. It it up to date and highlights recent increases and decreases in dividends. I'm not a spammer, but merely an investor who was also tired of seeing conflicting numbers regarding dividend dates and payouts. Try it. Good luck fellow FTR longs.
FTR's div will be covered for 3-4 quarters , mostly because
of being able to write downs of VZ assets acquired ,
it's mostly an accounting , but real .. the company is hoping
by then to have enough cash flow to continue the div ...
there is always some tummult when a company merges or
takes over another , or buys a unit ..
don't forget , FTR is now about 4X as large as before the
merger , over the next year , they have to absorb everything,
consolidate administration , reduce duplicities and
get the deal to be acretive ....
remember to, that investment returns / losses are directly
tied to risk .. no risk .. small returns or losses ,
greater risk . .bigger results ....
later .. garce