04-19-2015, 04:00 AM
(04-18-2015, 05:38 PM)Kerim Wrote: The 3 percent dividend raise is better than nothing, I guess. And we should not have expected much, I suppose, given that PG's metrics are not looking good. Earnings have gone nowhere since the great recession, and the continued raises has pushed the payout ratio to nearly 80 percent. I'm not sure if they have any tricks up their sleeve, but unless they can get earnings moving again, dividend raises are going to be paltry at best, if not discontinued. Am I overreacting?
I read that they were selling off many of their beauty brands at present that could raise around $12bn so I can't see them struggling to pay dividends in the near future. Looking longer term it wouldn't suprise me to see them rebasing their dividend if their 'growth' remains as poor as it is at present.
The streamlining of the business through selling off the underperforming brands will help PG decrease costs and the capital will probably be used to buyback shares. Whether this works in the long term is another question.
I think ULVR looks a lot healthier at present.
I'm tempted to buy at present but the strong $ is holding me off.