Q&A : Fundamental Analysis EPS Cannot Cover Dividend

by Dave
(Pa )

If the EPS of a company cannot cover the annual dividend, how can I determine if the company can cover the dividend from their cash flow? Where do I look on the companies balance sheet or income statement to determine if the company can cover their annual dividend, what amount should they have?

Comments for Q&A : Fundamental Analysis EPS Cannot Cover Dividend

Average Rating starstarstarstarstar

Click here to add your own comments

Jan 22, 2018
Rating
starstarstarstarstar 		Not Sure, But A Company That Can't Cover Dividend Is A Red Flag
by: Stephen

Hi, Dave

Thanks for the fundamental analysis question.

I'm not an expert in the FA arena. So if I tried to answer this question I would be misleading you.

But as far as I know, if a company can't even cover their dividend from their earnings, then it raises a red flag problem.

There could be a number of reasons, slowing business, competition or management problems.

As far as I know, the best companies are the ones that grow their EPS substantially y-o-y, or quarterly. Sometimes they don't even issue dividends. If they do, they will keep the dividend very small.

Hope this helps.

Stephen

Click here to add your own comments

Join in and write your own page! It's easy to do. How? Simply click here to return to Ask Me A Question Regarding Stocks.

  • If you like this article, consider starting the Stock Market Course. It is free and jam packed with great information for newbies.
  • Want to have updates on the financial markets? Join my Telegram Channel. Dstockmarket.com Channel.
  • Help support this page and press the Facebook Like button below. Thanks!

Recent Articles

RSS

  1. Technical Analysis Of DNEX (Dagang Nexchange)

    Feb 13, 19 01:23 PM

    In this page, we will attempt to analyze DNEX using principles of technical analysis. We will be looking at the weekly, daily and 60 min charts.

    Read More

  2. Technical Analysis Of US Stock Market February 2019

    Feb 13, 19 05:59 AM

    An analysis of the US stock market using the principles of technical analysis. What is Dow Jones doing and where will it likely go.

    Read More

  3. Technical Analysis Of VS Industry

    Feb 13, 19 04:52 AM

    In this article, we will analyze what VS Industry is doing through technical analysis. We will also look at what its trend is. Join me on this journey of technical analysis of VS Industry.

    Read More

  4. Technical Analysis Of Supermax

    Feb 12, 19 11:56 AM

    In this article we will use technical analysis to analyze what the price of Supermax is doing and to see what it is telling us.

    Read More

  5. Technical Analysis Of FTSE 100 UK

    Feb 12, 19 06:41 AM

    In this page, we will utilize technical analysis to see what is happening to UK's stock index, FTSE 100 and to see where it is likely to go.

    Read More