Hey guys, I received another cut yesterday that I wanted to share with you. After markets closed Diversified Royalty Corp (ticker: DIV) provided a business update in regards to the impact COVID-19 is having on the business. If my math is correct in this update they said they were going to reduce the dividend by 17%. This news doesn’t surprise me with this company as some of companies they own are small, I think of Sutton and Mr. Mikes in particular. Sutton deals with the real estate market and Mr. Mikes is a steakhouse restaurant chain.
The company currently pays a monthly dividend of $0.01958 ($0.2350 annualized basis) and that is going to be cut too $0.01667 ($0.20 annualized basis). Even with this cut the company is expecting the payout ratio to be over 100% for most if not all of 2020.
This cut won’t have a big impact on my income as I currently own 228 shares and with this news I will be losing $7.98 this year. Since I have a tiny holding of DIV within my portfolio I will hang onto the stock and see what happens.