I Had Made A Great Call - This Caught Me Off Guard
I made a post a month ago - with the information had just had a Golden Cross, and I thought the stock was a great pick up. AT&T was also fitting into other areas I typically look, solid companies paying high dividends, typically higher than the historical average.
I entered AT&T in March - with the details below.
Price Entry 28.24
Dividend Yield 6.86%
Things were going better than I thought they would, at least a lot quicker than I had hoped. In just over a month, the position moved up 15% and still had yet to pay a dividend. I kept holding, waiting until the price would start to eat away at the dividend yield and get closer to that 5.5% - 6% range. It got close to 6%, and then
Poof - Its all Gone
AT&T will cut its dividend nearly in half and end its 36-year streak of annual dividend hikes. It will no longer be a Dividend Aristocrat of the S&P 500, an elite title reserved for members of the index that have raised their payouts annually for at least 25 straight years. ~Montly Fool
Source
I had assumed they would raise it, investors love it, it helps keep their stock price, and they had the case. But the sale of Warner Media, which they bought only 3 years ago was a surprise to me. The market has imperfect information, and it looks like the sale initially was loved by the market, as seen in the massive green candle, but as investors digested the the dividend cut, that will be somewhere in the rage of 4-4.5% the stock took a major hit.
New Plan,
I will still get the fat dividend position until the sale closes in mid 2022, so I am not going to panic sell. I may wait to see if price can hold/climb back up a bit by the end of the year, and collect some dividends. I am still up 4% - not great but better than a loss.
Since I don't have any immediate other investments I want to move into, I will keep holding. I will be watching and if I can get the ROI up to around 10%+ I will consider closing the position, and taking AT&T off my favorite stocks to watch. I have traded them several times, and have always done well but I don't get too excited about 4%.
You Can't Control or Know Everything,
Just like I can't Make Elon tweet about HIVE/LEO and stop feeding DOGE and Fudding BTC, I don't know when companies are thinking about selling assets they just bought a few years ago. I will still mark this as a win, for now, but really put it in the lost opportunity bucket.
sincerely,
This post NOT financial advise, it contains my personal opinion and experience and is intended for educational purposes. Perform your own research and analysis prior to making investment decisions.