5 Dividend Stocks Back from the Dead | Summary and Q&A

TL;DR

Five dividend stocks with strong financial positions and good business models are poised to reverse dividend cuts and increase shareholder payouts.

Key Insights

• 💇 2020 has been challenging for dividend investors due to widespread dividend cuts across industries.
• 👋 Companies that have cut dividends may still have strong financial positions and good business models, making them potential candidates for dividend increases in the future.
• 💐 Analyzing a company's statement of cash flows, operational expenses, and cash reserves can provide valuable insights into their dividend safety and potential for growth.
• 🎴 Southwest Airlines stands out as a rebound play in the airline industry due to a lower break-even capacity and positive cash flow.
• 💐 Anheuser-Busch InBev is a top consumer products company with significant cash flow and a diverse portfolio of beer brands.
• ✋ Invesco's size and recent acquisition have increased its profitability and potential for a higher dividend.
• 🤣 Rollins, despite cutting its dividend, has shown strong revenue growth and increased cash flow which could lead to a dividend increase.
• 👨‍🔬 Conducting thorough research and analysis is crucial for making informed investment decisions and not relying solely on the recommendations of others.

Transcript

hey bowtie nation joseph hogue here with the let's talk money channel and a little bit of positivity for you in today's video nation 2020 has been a dividend investors nightmare the economic fallout has meant 773 dividend stocks have cut or suspended their payouts with 63 in the s p 500 index of those large cap companies it's the most since 2009 an... Read More

Questions & Answers

Q: Why have so many companies cut their dividends in 2020?

The economic fallout from the pandemic has caused companies across various industries to cut their dividends as a precautionary measure to protect their cash flow.

Q: How can investors identify dividend-paying companies with the potential to increase their dividends?

By analyzing the statement of cash flows, investors can look for positive cash flow from operations and free cash flow, which indicate a company's ability to support higher dividend payments. Additionally, comparing operational expenses with cash reserves can provide insights into a company's cash survivability.

Q: What makes Southwest Airlines a good rebound play in the airline industry?

Southwest Airlines has a lower break-even capacity compared to other major carriers, meaning it needs to fill fewer seats to break even. The company also has positive cash flow from operations and an impressive cash reserve, making it well-positioned for a dividend reinstatement.

Q: What sets Anheuser-Busch InBev apart as a dividend stock?

Despite a reduction in its dividend, Anheuser-Busch InBev remains a powerhouse in the alcohol industry with a strong portfolio of beer brands. The company generates significant operational and free cash flow, and its large cash reserves provide financial flexibility.

Q: Why is Rollins an interesting dividend stock despite cutting its dividend?

Rollins is a leader in the pest control services industry and has experienced significant revenue growth. Despite the dividend cut, the company's cash flow from operations and free cash flow have increased, indicating its ability to potentially raise the dividend again in the future.

Summary & Key Takeaways

• The economic fallout of 2020 has led to a high number of dividend cuts, with over 770 dividend stocks reducing or suspending their payouts.

• However, there are several dividend-paying companies with strong financials and business models that are expected to increase their dividends in the near future.

• Examples of such companies include Capital One Financial, Southwest Airlines, Anheuser-Busch InBev, Invesco, and Rollins.