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  • Terrific Growth In Hasbro's Dividend Is Coming [View article]
    If Hasbro continues its dividend growth anywhere near the 25% growth over the last 11 years, the cash required would be doubled in about three years, or slightly more time since some fewer shares could be involved. If net income and free cash flow are growing at some significantly lower rate (say, about 5%), and debt service is increasing, due to buybacks, then something has to give. There is just not enough money to maintain this path. So I do not see how you can be confident about dividend growth under this scenario. I don't have the details about your models, so I can't speak directly to them.
    Sep 13, 2012. 12:39 PM | Likes Like |Link to Comment
  • Terrific Growth In Hasbro's Dividend Is Coming [View article]
    Hasbro's investment policies include borrowing money to fund stock buybacks, since free cash flow does not cover both dividend payments and buybacks. This trend is increasing over the last few years. My judgment is that the increasing debt and the adherence to buybacks on the part of management does not bode well for dividend growth in the future, in spite of the growth in dividend payouts since 2005. If my sleep is affected, I tend to look elsewhere.
    Sep 11, 2012. 12:13 PM | Likes Like |Link to Comment
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