Originally Posted by
asdf1234
The share price is high because Stobart pay out £60m a year in dividends. They do this by selling off assets. Of course this can't last for ever (they will run out of assets to cover the dividend in the next 3 years).
Good post.
The share price is driven by sentiment. It is not, in itself, proof that everything is rosy in the garden.
Stobart Group's dividend cover was 0.82 in 2016, falling to 0.6 this year. Anything less than 1.0 indicates that the dividends are not covered by earnings, and can only be maintained from asset sales or reserves.