Bad news: American Capital Strategies has also fallen victim to the credit crunch and has decided to suspend its dividend payments.
Obviously, I am extremely disappointed by the news. ACAS has been my favorite high-yield play in the financial sector, and one of the companies that looked best positioned to capitalize on temporary weakness in the credit markets.
The company’s long history of dividend payments also supported my belief that it would continue paying its investors through thick and thin.
I’m still confident that the company will go on to pay out nice dividends in the future. But for now, they think preserving cash is the right approach. Fair enough.
I will provide a complete update on ACAS in the next issue of Dividend Superstars …
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{ 2 comments… read them below or add one }
didn’t CEO Wilkus say on several occasions that the 2009 dividends were in the bank and safe ? And didn’t he also say that since their financing structure was vertically integrated the credit crisis didn’t affect them? Wish i could
find those quotes
I’m a real RWR customer and Larry’s Option Alert. As far as dividends are concerned, Larry has made some great recommendations. As I focus more on a steady income recently, I’m looking for investments that will produce 9 -10%
returns or better (less any growth of the stock). What’s your take on that?