Unsustainable Dividend Shares

These are companies that payout an unsustainable dividend. That is, the current annual dividend payment is greater than the reported earnings per share. In many cases this will be a once off event due to a poor earnings year caused by an unforeseen event and earnings will recover next year, but it is prudent to investigate why your investments candidates are paying out more in dividends than they are earning.

Here is a checklist of factors that may make a companies dividend unsustainable:

  • High Payout Ratio – can future dividends be met by earnings? Does the company retain enough earnings for reinvestment and maintenance of key income producing assets.
  • High Debt to Equity Ratio – is the company able to meet interest payments and still be sufficiently profitable to pay dividends?
  • Earnings trend and Guidance – is the direction and quality of earnings, and the future guidance of earnings consistent sufficient to maintain dividend payments?

The following is a list of dividend paying companies that have recently reported negative earnings or where the dividend is greater than earnings.



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Stock Company Sector Dividend
(cents)
Franking Yield Price
(cents)
Earnings
per Share
(cents)
Dividend
Cover
Star Rating
VTSVngd US Total Market202.52.5%0%1635300.00x
RCBRussell Au Sel Corp Bnd54.01-2.5%0%204800.00x
PRTPrime Media GrpMedia 3.4100.0%10.97%31-25.1-7.38x
PRGProgrammed MaintCommercial & Professional Services 8.5100.0%4.96%171.5-37.8-4.45x
PNWPacific Star NetMedia 1.65100.0%7.17%23-5.4-3.27x
MCPMcPhersonsConsumer Durables & Apparel 8100.0%6.27%127.5-10.7-1.34x
KSCK & STransportation 1.5100.0%1.83%164-10.3-6.87x
IZZiShares China LCapNot Applic 104.898.2%1.99%5270-198.99-1.90x
IXIiShares Glb Cons241.657.4%1.74%13850-197.35-0.82x
IVViShares S&P 500Not Applic 495.834.0%1.55%32042-187.02-0.38x
IVEiShares MSCI EAFENot Applic 197.487.3%2.25%8793-1875.33-9.50x
RDVRussell High Div98.310.0%0%301900.00x
RGBRussell Au Govt Bnd52.660.0%0%213000.00x
VLCVngd MSCI Au Large Co215.73.6%0%605500.00x
VHYVngd Aust High Yield279.99-4.4%0%614900.00x
VGBVngd Aust Govt Bond65.25-7.4%0%494800.00x
VEUVngd All-World ex-US70.325.7%0%673600.00x
ZGLZicom GrpCapital Goods 0.350.0%2.8%12.5-2.74-7.83x
VAPVngd Aust Property205.99-20.1%0%791500.00x
URFUS Masters Res PropReal Estate 50.0%4.9%204-14.7-2.94x
SMXSMS ManagementSoftware & Services 4.5100.0%2.76%163-61.19-13.60x
RVLRussell Aust Value135.850.0%0%301300.00x
RSMRussell Au Semi Bond31.650.0%0%206500.00x
ITWiShares MSCI TaiwanNot Applic 78.4810.8%1.7%4615-904.9-11.53x
IRUiShares Russell 2000Not Applic 215.352.2%1.18%18202-191.53-0.89x
CABCabcharge AustCommercial & Professional Services 100100.0%7.78%257-87.6-0.88x
AWCAluminaMaterials 4.03100.0%4.29%184-1.38-0.34x
AUPAurora PropNot Applic 43.940.0%9.76%45000.00x
AUFAsian Masters FundDiversified Financials 6.1-173.2%1.57%140-1.11-0.18x
AODAurora Div Inc TrNot Applic 1.469.5%6.16%69.5-1.6-1.14x
AMPAMPInsurance 2890.0%5.51%508-11.7-0.42x
ALQALSCommercial & Professional Services 11.549.6%1.98%581-56.81-4.94x
AIBAurora Global Inc TrDiversified Financials 6.270.0%7.65%82-3.08-0.49x
ABWAurora Absolute RetNot Applic 3.470.0%6.67%52-8.61-2.48x
AADArdent Leisure GrpConsumer Services 7.50.0%3.66%205-6.28-0.84x
CDMCadence CapitalNot Applic 8100.0%6.64%120.5-5.2-0.65x
DCGDecmil GrpCapital Goods 4100.0%4.44%90-2.7-0.68x
FRIFinbar GrpReal Estate 7100.0%8.75%80-0.4-0.06x
IPEIPEDiversified Financials 3.464.7%30.91%11-1.35-0.40x
IOOiShares Glb 100 ETFNot Applic 236.527.2%2.08%11375-344.08-1.45x
IJPiShares MSCI JapanNot Applic 75.5610.1%1.49%7105-361.2-4.78x
IHKiShares MSCI HKNot Applic 66.827.4%2.13%3135-224.84-3.36x
IEUiShares EuropeNot Applic 133.516.7%2.21%6040-395.26-2.96x
IEMiShares MSCI Em MktNot Applic 73.968.7%1.36%5441-1950.25-26.37x
IAAiShares Asia 50Not Applic 119.238.4%1.6%7453-418.33-3.51x
GUDGUD HldgsConsumer Durables & Apparel 44100.0%3.75%1174-31.88-0.72x
GCSGlobal ConstructCapital Goods 1100.0%3.7%54-38.9-38.90x
FXJFairfax MediaMedia 470.0%3.21%124.5-36.1-9.03x
VASVngd Aust Shares247.97-1.9%3.65%73051.770.01x
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Disclaimer
The information provided on this website is for use of a general nature only and is not intended to be relied upon as, nor to be a substitute for, specific professional or investment advice. The team at Dividends.com.au are not lawyers, financial planners, investment advisers, or accountants. So, before taking any action or risking any money, you should always check with your own qualified professional advisers.