RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:Lots of liquidity!A very reasonable post.
These are different companies, of course, but when IPL cut its dividend a month ago, it's price took a modest hit for a few days, then completely recovered and went up with the market after that. I think investors were initially concerned that the financials would continue to erode (mostly from dilution) without the cut, so the cut improved the outlook for the company. Yes, SRT.un stock might take a further hit here too but, if they can substantially restore the distribution later, things will eventually recover. Keep in mind that a hit is already priced in so it all hinges on whether or not investors think the company is better or worse off, post cut (and I suppose some income investors will leave, partially offset by some bargain hunters). BTW, over at IPL, no one is talking about the dividend being restored to its former level, although it should go up once the new plastic plant is up and running. Here, with careful management (which you don't think much of), they might just be able to substantially restore the distribution within a year or two. Personally, I'd prefer it if they kept back a little more for growth, notwithstanding the fact that they've been able to increase the distribution by 14.3% over the past 5 years even with such a high PR.