GCI’s Connell: No dividend cut in the works, but . . .

. . . the company’s chief flack wouldn’t rule it out either, Dow Jones says, as Gannett’s stock dividend nears a sky-high 10% yield. “When it comes to paying dividends, paying down debt and paying for acquisitions, we’re constantly evaluating all our options,” Tara Connell told the news service.

CEO Craig Dubow has said that maintaining the dividend is one of his top priorities. Any concession would likely send GCI’s stock even deeper into the toilet.

The Dow Jones story warns investors that the days of rich dividend payouts for newspaper publishers could be numbered. “These stock prices are declining, and the market is sending a signal that these dividends are not sustainable,” Morningstar analyst Tom Corbett says. “When you have a company with declining profitability paying out above-average dividend yields, investors need to ask themselves how long this will be sustainable.”

Gannett’s yield surged to 9.3% after the company reported dismal quarterly earnings, crushing investors’ hopes for a shift in its strategy. GCI shares dived to new 20-year lows.

Earlier: Testing new lows, Gannett stock tumbles 2%

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One Response to “GCI’s Connell: No dividend cut in the works, but . . .”

  1. Anonymous Says:

    It is a big mistake not to cut the dividend. Use the money to invest in new products.

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