Dividend Yield: 12.5%
The good news is Pitney Bowes (NYSE:PBI) knows that businesses are going to rely even more heavily on automation and “big data” management in the future.
The bad news is Pitney Bowes doesn’t appear to be giving businesses what they want. Sales and operating income have been steadily declining since 2008, meaning PBI hasn’t been participating in the economic rebound, even though its peers have.
To give credit where it’s due, it’s still profitable — at least for the time being. The problem is, the difference between PBI’s per-share income and the dividend is quietly getting smaller.
For perspective, Pitney Bowes earned $2.78 per share in 2008 and paid out $1.40 in dividends. For 2012, the company will earned $1.99 per share, and has already paid out $1.52 in dividends. Translation: The payout ratio is getting larger, and if Pitney can’t stop bleeding revenue, that 12%-plus dividend yield could be the first thing to suffer.