Foot Locker Paused Its Dividend. Is the Turnaround in Trouble?
If there is one thing a dividend investor hates to see, it's a dividend cut. But that's just what Foot Locker (NYSE: FL) has done as it attempts to turn its business around. Investors should most definitely read into the board of directors' decision on this one. The timing suggests that the company's turnaround isn't going nearly as well as hoped.
From a big-picture perspective, shareholders buy a small piece of a company when they purchase a stock. The company's earnings per share is the portion of earnings that are attributable to each share of stock an investor owns. Although the company can do whatever it likes with that money, a dividend is, basically, a tangible return of cash from the company's long-term earnings stream. Basically, you are being rewarded for being an owner.
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Source Fool.com
