Hypothetically - Let's say they cut the div 25% to .06 per month - Let's say the price drops to 6.50 -
Based on this - you get .72 per year or 11% yield if not reinvesting the div - I like 11% on any stock, especially one that looks stable -
here is my rationale - you have to evaluate yours -
I bought 2k share to average down to 6.84 - I keep the stock, even if it goes to 6.50 - I accumulate div of .06 (if it lowered to that and stays there for a year) - 4k x .06 x12 months = 2880 in div - this means I have a vested share price of 6.10 (6.84 - .72) - if stock is still at 6.50, I still make1600 or 6% - anything above 6.50 is extra - I like the bet - let's hope it goes to 7 or my previous outlook of 7.50 - if we just didn't have to put up with the paid dumpers
No - What I am saying and not trying to mislead anyone 'cause everyone has to do their own DD
I like the stock no matter if they cut the Div - I think it is a good stock even if they cut the Div and the price hovers around the 6.50 range - I don't own a lot (4k), but I am holding it for at least a year, unless something drastic happens - and if their are some people who don't like the honest comments - well that is your choice
Your post is a reminder to everyone to keep things in perspective. I don't know of a CD or Bank out there
that will give you an 11 % rate of return. As for the Share Price - look for 7 in the near term, 8 in the long term.