By Dividend Yield:
A good example how debt destroys the dreams of dividend growth investors is Tesco (OTCPK:TSCDY). The company cut its dividend payments yesterday by 75 percent. The major reasons for the trigger were worsening earnings as well as a high debt burden.
Warren Buffett also bought a small stake in Tesco a few years ago and most of us thought it was a safe haven but as I saw the huge debt amount of 10 billion British pounds, I was shocked. Am I wrong? Did I oversee something in my analysis? No! Now we see the bitter result of a weakening business with high debt.
| Quick Tesco Income Statement |
Source: MSN Money
I personally love companies with strong growth and low debt ratios. In my blog, I’ve also often published hundreds of stock ideas and some of them performed very well.
The market is full of high dividend payers with a
