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No. of Recommendations: 6
CBL suspends dividend to pay settlement...

Thanks for the info.

Per their 2018 1099-DIV, CBL paid about $137.813MM to common shareholders, so two quarters of dividends at this rate would be about $68.91MM, which I'm assuming they'll combine with about $19.2MM out of C&CE (which at the end of 2018 they had $57.5MM) to get the $88.1MM needed for the settlement.

Interestingly, for 2018, 82.36% of the common dividend was ordinary income and 100% of the preferred D and E dividends were ordinary income, meaning, if I've done the math right, $159.042MM of all dividends was ordinary income for 2018. Just to rough this out....assuming this represents 100% of their REIT Taxable Income, and assuming this amount of taxable income remains the same for 2019 (yes, big assumption) and assuming the estimated $88.1MM settlement is deductible from REIT taxable income, then CBL would have to distribute as dividends for 2019 a minimum of ($159.042 - 88.1) X .9 = $63.85MM. So hopefully, the $44.892MM dividends to the D&E preferreds will be safe.

Depending on their continuing operations, debt maturity schedule and the like, the D and E preferreds, at today's closing prices of $9.34 and $8.78, providing current yields of 19.7% and 18.9%, may be worth a look for those with suitable risk tolerance. I mean, 100 shares of the D preferred = $934, and with an annual dividend of $184.37, you'd break even in about 5 years :-)

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