Originally Posted by
SARF
More share price at all time high. More Quarterly div goes up again..
More yield over 5 per cent. Yes it's all a disaster for stobart group
This point has been made before, but I'll make it again. Stobarts dividend payments are not covered by profits. The company can only afford to continue making those payments by selling off assets, and they have acknowledged, in their recent trading update, that funding the dividends in this way is not sustainable beyond 2022.
If Stobart Group can't increase profits to fully cover the dividend by this time then they will probably need to cut it. I'm not saying that will happen, but it's a high risk strategy and the share price will suffer if they fail.