I think we can all agree that our dividend is ridiculously high. Maintaining it has been a burden on the company for a while now and it will continue to be heavier and heavier burden in the future. So what's the worst thing that could happen if it was cut? Not even drastically, maybe by a third? I really don't think the stock would "crash and burn," as some people believe. But maybe, just maybe, it would slow down layoffs.
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The stock would go down in price. So long as they're hanging onto the dinosaur called tip & ring, there is no growth to this company. As far as the debt is concerned, there is a lot of debt in business and government debt. The Federal Reserve has printed about $7T this year, with no end in sight. That could lead to a currency debasement, which would be a debt debasement. I think that is more likely than not.
The pension is the next thing to go, then 401k, then when att declares bankruptcy, govt owns your retirement. Get out why you can!!! Take the lump sum and run!!!!
ask yourself why the dividend is a sacred cow?
cause executives make huge parts of their incomes from it and so does the board!!!
That they use that money for buy back temporarily increasing the stock price and all that going away when it goes down,
Randy was asked about dividend policy and cutting the dividend when he was CFO around yr 2000.
He knew then as did Big Ed and now Stink Man - cut the dividend and stock holders will head for the exits AT ANY PRICE.
Karma! Fire Fire Fire. I'm looking for a 35% dividend payout.
"The bigger question is whether they used the government bail-outs and subsidies to pay out the dividends - instead of building out rural networks or keeping jobs they stated as the reason for needing government assistance at all."
I think we all know the answer to this - the BIGGER question is why haven't other states held T's feet to the fire on this and asked them where this money went.
Well...I guess we all know the answer to that question as well.
"There are many many people who hold it only for the dividend"
Why in the name of God would ANYONE hold this stock, aside from the dividend?
If dividends are cut, investors will sell. As said, the stated company goal is to 'create shareholder value' as the most important thing. Note, the most important things are not the customers or employees. If no/low dividends are paid, no investor has any reason to buy this stock; it just does not make any money.
If it does not make enough cash for dividends, the company's credit rating will also drop, and is now a credit risk. The latest round of refinancing debts took 12 banks to pull off.
Agreed that even if the dividend were cut, they would just use the money to buy back the company's own stock to prop it up, or pay executive packages. In no way do I see them using the extra cash to keep any jobs, or invest in the network. They've said before that with the low interest rates, they will not use good cash to finance network improvements, if they can just take out another loan and slowly pay it back, and protect the cash flow.
The bigger question is whether they used the government bail-outs and subsidies to pay out the dividends - instead of building out rural networks or keeping jobs they stated as the reason for needing government assistance at all.
Good luck getting an answer on that ( Mississippi anyone?).
The goal of the c suite and the BOD is to increase shareholder value (not doing very well) and pay the dividends. It’s not to be an employer of thousands of people. If you don’t understand this you are woefully uninformed.
No longer being a "dividend aristocrat" (https://en.wikipedia.org/wiki/S%26P_500_Dividend_Aristocrats) will cause a lot of selling I believe. There are many many people who hold it only for the dividend.
Actually it will accelerate layoffs if the dividend was cut. You will see a sharp decline in the company's stock if that happens.
Any reduction or even no increase in the annual dividend rate would result in a significant decline in the share price. Investor expectations are to maintain the purchasing power of the dividend in this low inflation environment. With poor financial performance that is the only factor keeping the share price from cratering.
The GOOD news, Stankey would be gone in a New York minute!!!
Don't talk about that,be Pissitive I want 12% Dividend.....Or may be AT&T's destiny is hanging by a thread..LOL
Gee, if T cut the Dividend, then Ratty would have his $1M quarterly payment reduced!
See how it works?
Wall Street would rewrite the OP's post this way:
"I think we can all agree that costs are ridiculously high. Maintaining them has been a burden on the company for a while now and it will continue to be heavier and heavier burden in the future. So what's the worst thing that could happen if costs were cut? Not even drastically, maybe by a third? I really don't think the company would "crash and burn," as some people believe. But maybe, just maybe, it would slow down stock price dive."
If you like worthless stock then cut or eliminate the dividend. There seems to be some a lack of education in this thread.
We definitely cannot all agree.