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
Franking Yield Price
per Share
Star Rating
AADArdent Leisure Grp8.5-178.4%4.15%205-6.14-0.72x
PFGPrime Financial0.9100.0%7.83%11.5-0.06-0.07x
PPGPro-Pac Packaging2100.0%6.06%33-0.31-0.16x
PRYPrimary Health Care10.9100.0%3.06%356-98.9-9.07x
QBEQBE Insurance Grp2630.0%2.66%979-117.31-4.51x
RCBRussell Au Sel Corp Bnd48.03-58.5%0%200100.00x
RDVRussell High Div135.29-104.6%0%293800.00x
RGBRussell Au Govt Bnd30.71-47.6%0%210300.00x
RSMRussell Au Semi Bond30.44-56.7%0%205300.00x
TAHTabcorp Hldgs23.5100.0%4.94%476-7-0.30x
TGAThorn Grp3.5100.0%5.88%59.5-2.28-0.65x
URFUS Masters Res Prop5-233.3%6.9%145-3.76-0.75x
VAPVngd Aust Property501.62-233.3%0%816100.00x
VEUVngd All-World ex-US87.55-187.6%0%707200.00x
VGBVngd Aust Govt Bond78.04-233.3%0%489800.00x
VHYVngd Aust High Yield18054.8-232.1%0%580300.00x
VLCVngd MSCI Au Large Co147.84-106.3%0%640200.00x
IZZiShares China LCap168-95.8%2.83%5785-198.99-1.18x
ABWAurora Absolute Ret2.33-30.0%5.3%44-15.73-6.75x
AGGAnglogold Ashanti1.230.0%0.53%230-58.94-47.92x
AIBAurora Global Inc Tr3.83-14.0%13.68%28-15.25-3.98x
AODAurora Div Inc Tr1.22-145.9%6.53%58-0.81-0.66x
APZAspen Grp4.2-116.7%4.44%94.5-1.27-0.30x
AUPAurora Prop30.98-30.4%10.83%28600.00x
AZJAurizon Hldgs1450.0%5.24%437-1.44-0.10x
CAJCapitol Health0.4100.0%1.33%30-0.75-1.88x
GAPGale Pacific20.0%5.48%36.5-3.14-1.57x
IEMiShares MSCI Em Mkt131.782-58.6%1.82%5925-1950.25-14.80x
IGOIndependence Grp2100.0%0.4%505-0.05-0.03x
IJPiShares MSCI Japan96.86-126.5%1.23%7758-361.2-3.73x
ILUIluka Res31100.0%2.62%1184-41-1.32x
IMFIMF Bentham3100.0%2.65%264-1.72-0.57x
IVEiShares MSCI EAFE236.85-152.1%2.56%9125-1875.33-7.92x
VTSVngd US Total Market206.35-78.4%0%1956200.00x
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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.