Dividend payment from shares Question
Discussion
I have recently acquired shares in a property investment company who buy properties from companies and lease them back to them. Over the last 12 months the companies value have dropped allot because of the value of the properties on their books. But there rental income hasn't changed much if any at all. At present they have 1670 assets under management, 95.9% and let and the average lease is 10 Years. My question is how will the dividend payment be calculated i.e. will they be affected because of the the falling asset value of the company? Or be in line with the stream of income?
Thanks,
Matt
Thanks,
Matt
Dividends can only be paid from profit, so assuming the company has made a profit, then the board may then elect to pay a dividend. The questions you need to ask the company are 1) are you in profit and 2) do you intend to pay a dividend...for example they may not if they anticipate they will require the retained profit to meet forthcoming costs e.g. remortgaging.
UpTheIron said:
Dividends can only be paid from profit, so assuming the company has made a profit, then the board may then elect to pay a dividend. The questions you need to ask the company are 1) are you in profit and 2) do you intend to pay a dividend...for example they may not if they anticipate they will require the retained profit to meet forthcoming costs e.g. remortgaging.
I understand, thanks for your advise. I will ask the questions! Matt
As UTI siad, availability of sufficient profits is the first criteria examined wheb making dividend payment decisions. However, even if there is sufficient profit built up in the company, the board may decide that they want to retain funds in the company for future investment or as a hedge against possible bad times ahead.
British Airways has not paid a dividend in over a decade yet there have been times over the past few years when they have been highly profitable.
British Airways has not paid a dividend in over a decade yet there have been times over the past few years when they have been highly profitable.
Eric Mc said:
As UTI siad, availability of sufficient profits is the first criteria examined wheb making dividend payment decisions. However, even if there is sufficient profit built up in the company, the board may decide that they want to retain funds in the company for future investment or as a hedge against possible bad times ahead.
British Airways has not paid a dividend in over a decade yet there have been times over the past few years when they have been highly profitable.
Thanks Eric, Your help is much apreciated.British Airways has not paid a dividend in over a decade yet there have been times over the past few years when they have been highly profitable.
Matt
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