Don-n-ABQ

Cramer's Stop Trading! Costco Comes Back (10/7/09)

The reason COP went up was because they said that they were going to sell $10 billion in assets and cut the exploration and capital expenditures budget to pay down debt. Their are trying to fix their balance sheet, which is not as attractive as the other big boys. The increase in the dividend is to retain investors from fleeing to higher quality and maybe attract some new investors looking for dividend yield.

Yield investors are usually longer term investors, so the company is trying to attract long term investors who want a better balance sheet, but a slower growth rate (they will grow slower by giving up some of their assets and cap-ex budget).


On Oct 08 08:35 AM CFO wrote:

> COP already started such a massive cost & asset reduction plan.
> Wonder what is the logic behind dividend increase?