About Dividends

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If a company has been paying a dividend for years and periodically cuts its dividend for whatever, is it obliged to make up the shortfall in the future? I have seen dividends lowered then later raised. I this whats going on? Are they tied to any rules or obliations with respect to dividend payments ? If they say they pay a 4% dividend do they have to stick to that ?
Thanks.

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Asked on February 9, 2022 4:13 pm
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Paying regular dividends is seen as a commitment, which may occasionally change for a few good reasons (shortfall of profits, expanding the business), not a contract. There are some companies out there that have a variable dividend policy; higher in good times, lower when not so.

Not my area of expertise, but I believe unpaid preferred dividends normally accumulate until paid.

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Posted by Krispee
Answered on February 10, 2022 7:40 am
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