Today, Viacom has stated that it will be cutting its quarterly dividend from $0.40 per share to $0.20. The next quarterly dividend will be payable on the 3rd of October to shareholders of record on September 22.
The company has also said that it now forecasts adjusted EPS to end up in a range from $0.65-$0.70 for the fourth quarter. This is lower than the average analyst estimate (taken from a poll by Thomson Reuters) of $0.89.
While these disclosures are significant, the biggest news coming from Viacom today was its announcement that interim CEO Tom Dooley will be leaving the company in mid-November. Mr. Dooley took over the helm of Viacom just four weeks ago after then-CEO Philippe Dauman resigned. This comes as a surprise to most people since Dooley was expected to be given more time to try and lead a positive turn around for the company.
Leadership conflicts regarding Dauman and Sumner Redstone (former chairman of the board and majority shareholder in CBS and Viacom) have plagued Viacom’s reputation as a media leader since 2015. The company has become a victim of the cord-cutting trend as well, and it has seen its viewership falter while content creation costs have risen. Strong leadership is especially crucial for Viacom if it is to make a turnaround for the better. Unfortunately, the removal of Dooley shows that proper leadership could be lacking from within the company.
Viacom’s dividend yield got slashed, and it now provides investors with a 2.2% yield. The earnings outlook for Viacom has been trending lower as we’ve progressed through the quarter. In the last two months, no analysts have posted positive EPS revisions for the current quarter or year. In that time frame, 12 analysts have revised their expectations lower for the current quarter. Over the past two months, our EPS consensus estimate for the quarter has fallen, going from $1.42 to $0.97. For the current year, 16 analysts have revised their estimates lower in the last 60 days, leading our consensus to fall from $4.40 to $3.93. VIAB stock is a Zacks Rank #5 (Strong Sell).
The Zacks Rank is a truly marvelous trading tool. Our ranking system has beaten the S&P 500, yielding an average return of 25% per year for the last 29 years! Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
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Viacom Cut its Dividend, but Here's Why Else You Should Sell it
Today, Viacom has stated that it will be cutting its quarterly dividend from $0.40 per share to $0.20. The next quarterly dividend will be payable on the 3rd of October to shareholders of record on September 22.
The company has also said that it now forecasts adjusted EPS to end up in a range from $0.65-$0.70 for the fourth quarter. This is lower than the average analyst estimate (taken from a poll by Thomson Reuters) of $0.89.
While these disclosures are significant, the biggest news coming from Viacom today was its announcement that interim CEO Tom Dooley will be leaving the company in mid-November. Mr. Dooley took over the helm of Viacom just four weeks ago after then-CEO Philippe Dauman resigned. This comes as a surprise to most people since Dooley was expected to be given more time to try and lead a positive turn around for the company.
Leadership conflicts regarding Dauman and Sumner Redstone (former chairman of the board and majority shareholder in CBS and Viacom) have plagued Viacom’s reputation as a media leader since 2015. The company has become a victim of the cord-cutting trend as well, and it has seen its viewership falter while content creation costs have risen. Strong leadership is especially crucial for Viacom if it is to make a turnaround for the better. Unfortunately, the removal of Dooley shows that proper leadership could be lacking from within the company.
VIACOM INC-B Price and Consensus
VIACOM INC-B Price and Consensus | VIACOM INC-B Quote
Viacom’s dividend yield got slashed, and it now provides investors with a 2.2% yield. The earnings outlook for Viacom has been trending lower as we’ve progressed through the quarter. In the last two months, no analysts have posted positive EPS revisions for the current quarter or year. In that time frame, 12 analysts have revised their expectations lower for the current quarter. Over the past two months, our EPS consensus estimate for the quarter has fallen, going from $1.42 to $0.97. For the current year, 16 analysts have revised their estimates lower in the last 60 days, leading our consensus to fall from $4.40 to $3.93. VIAB stock is a Zacks Rank #5 (Strong Sell).
The Zacks Rank is a truly marvelous trading tool. Our ranking system has beaten the S&P 500, yielding an average return of 25% per year for the last 29 years! Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>