Dividend coverage
Also written coverage.
Definition
How well an issuer can pay its preferred dividend: the heaviest pillar in the preferred score. Operating companies are scored on earnings coverage in bands at 5, 3, 2 and 1 times. Funds and BDCs are scored on asset coverage against their legal floors, with the cushion above the floor once a ratio is on file. Banks and insurers are scored on the length of their unbroken payment record.
On a live record
ARCC (Ares Capital) shows 1.07x coverage: net investment income over the regular dividend, trailing four quarters. At 1.00x the dividend was exactly earned. Open the ARCC record.
Written from the public record at the last refresh. Prices are 15 minutes delayed.
Definitions describe how YieldDesk reads the term. Nothing on this page is investment advice or a recommendation to buy, sell or hold.