BHP overpaid for shale gas assets in the US. That’s costing it now. And it may cost shareholders their dividends.
The downgrade encouraged a selloff of BHP shares. The big miner slipped by almost 2% in yesterday’s trade and has fallen almost 4% this morning.
The dividend yield represents the return you’d expect to make on a stock using past dividends at the current share price.
The company was able to return an annual dividend of 18 per cent for almost 200 years, due to the policy followed by its directors in Amsterdam.
When it comes to growth, few stocks offer better growth opportunities than small-cap stocks.
Analysts are beginning to believe the slump in commodity prices will force BHP to cut its dividend payments.
The dividend yield on a stock isn’t fixed. If the economy slows, revenue slows, and profits shrink, what will that mean for the dividend?
The irony in all this is that the perception of dividend stocks as a safe investment is one of the things creating the biggest risk for the Aussie market and Aussie investors today.
That means staying in stocks… but it also means buying one of two (or both) specific stocks, which will rise in value as stocks fall.
If you're managing risk with a dividend portfolio, you may use position sizes to help you achieve an overall level of yield for your portfolio.