Petrobras: Dividend Investors Beware (Archive)
Beware Petrobras: dividends can’t offset likely capital losses and value destruction.
This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.
Elevator Pitch
- I double down on my bearish view on Petróleo Brasileiro S.A. as a couple of unfavorable developments have occurred.
- Falling oil prices are a powerful blow to Petrobras' only trump card.
- A new $3.2 billion liability will hit cash flows and impair dividends.
- I see at least 13% downside in Petrobras stock, if not more.
- I know Petrobras is a favorite of dividend investors; but I urge caution as total shareholder return is what matters; capital losses can erode your dividend yields.
Read the full article here.
Disclosures and Disclaimers
Past performance ≠ future results. Not investment advice. See full Disclaimer.
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