JuanDB wrote:CTY is due for its annual increase next dividend payment. It will be interesting to see the level of increase as a measure of confidence given their 54 year run of increases.
Current dividend is 0.0475
I would consider par to be 0.0495 (this is the value I have pencilled in my “growth projection” spreadsheet)
0.05 would be generous and I’d be very surprised given the current climate
Less than 0.0495 would be a warning sign for me.
Don't forget that ITs need to pay out a minimum of 85% of their earnings in any one year to maintain IT status so that puts a floor under the dividend. Anything over that is a bonus to my mind. At this time, ITs should be reporting good income as it reflects the past 12 months but going forward? If I were running an income IT I would be cautious because there looks to be not much doubt that dividends as a whole will be well down in the next 12 months. Just look at the growing list of cuts and suspensions. However, CTY as a long record of dividend increases and that will obviously influence their their thoughts. I am not sure though that an increase on last year should be seen as a sign of confidence but rather a desire to keep their dividend record intact. They can of course use their Revenue Reserves to supplement current income and help to bridge any shortfall. I don't think you need a warning sign for CTY; it is all around us at the moment.