Verizon Is Cutting 3,000 Jobs and Handing 274 Stores to Franchisees Right Before July 24 Earnings. Is the 6.5% Dividend Still Safe?
Another restructuring is rattling nerves days before earnings. The cash flow math, however, tells a calmer story.
Overview
Verizon (NYSE: VZ) spent last week doing what it has done all year under CEO Dan Schulman: getting smaller. The telecom giant said it will sell 274 company-owned retail stores to franchise operators and cut about 500 corporate positions, moves that affect roughly 3,000 employees in total. The changes take effect in mid-August and come on top of the more than 13,000 job cuts Verizon announced in November.
Headlines like these can spook income investors. But does it make sense to be fearful? At the stock's current price near $44, shares yield about 6.5% -- one of the largest payouts among major U.S. companies.
Details
So, with second-quarter earnings due Friday morning, July 24, is a dividend this big still safe at a company this focused on cutting?
Source
Originally published at www.fool.com.