☁️ Watch this tech player closely...

This time, it all comes down to free cash flow.‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ 

SPONSORED Do You Own ANY 5G Stocks? CNN calls 5G "the lifeblood of the new economy." If you don't invest now, you'll regret it later. Click here for details on the top 5G stock... SAFETY NET Is This Cloud Company's Dividend Flying Too Close to the Sun? Marc Lichtenfeld, Chief Income Strategist, The Oxford Club NetApp (Nasdaq: NTAP) is a cloud storage and data management company based in Silicon Valley. But unlike most tech companies, this one has a robust 4.5% dividend yield. Can tech investors expect to continue to receive their $0.48 per share quarterly dividend? A big red flag is that NetApp's free cash flow is headed in the wrong direction. In 2019, it declined slightly to $1.17 billion from $1.33 billion the year before. This year, free cash flow is projected to drop to $936 million, and then it's expected to drop all the way down to $714 million in 2021. This year, NetApp is forecast to pay $439 million in dividends, or 60% of its free cash flow. In normal, nonpandemic times, that would be perfectly okay. But during the pandemic, I've taken my threshold for an acceptable payout ratio down to 50%. (A company's payout ratio is the percentage of free cash flow that it pays in dividends.) The reason I lowered the threshold from 75% to 50% is because the pandemic has created havoc for many businesses. Across the board, management teams understandably feel the need to conserve cash. I want to make sure we are not caught by surprise, assuming a dividend is safe only to see it cut later. SPONSORED Bill O'Reilly Did What?!? Bill O'Reilly is no stranger to controversy. The mainstream media LOVES bashing him. And they might just have a field day with this. Because Bill is releasing his most controversial project yet. See what it's all about right here. A company that pays out 50% or less of its cash in dividends has a big enough buffer that it can afford to keep paying the dividend even if free cash flow dips. NetApp has a solid but brief dividend-paying history. Since it began paying a dividend in 2013, it has raised the payout every year except 2020. But that dividend track record isn't enough for SafetyNet Pro. The falling free cash flow is a major problem, and the higher-than-acceptable payout ratio is also an issue. NetApp's dividend is attractive, especially for a tech company, but I don't think you can consider it safe. The dividend cut may not come immediately, but if 2021's numbers are weaker than expected, a reduction next year is very possible. Dividend Safety Rating: D If you have a stock whose dividend safety you'd like me to analyze, leave the ticker symbol in the comments section. Good investing, Marc Leave a Comment MORE FROM WEALTHY RETIREMENT 10 Billion Reasons to Add Wells Fargo to Your Portfolio Do You Need Life Insurance? Profit From This Retirement Rule Facebook Twitter Email Share SPONSORED Do NOT Flip Houses... Start Collecting Real Estate Income With as Little as $50 This is the easiest way to start collecting real estate income. You could be looking at thousands of dollars over time! Here's how. You are receiving this email because you subscribed to Wealthy Retirement. Wealthy Retirement is published by The Oxford Club. Questions? Check out our FAQs. Trying to reach us? Contact us here. Please do not reply to this email as it goes to an unmonitored inbox. Privacy Policy | Whitelist Wealthy Retirement | Unsubscribe © 2020 The Oxford Club, LLC All Rights Reserved The Oxford Club | 105 West Monument Street | Baltimore, MD 21201 North America: 1.800.589.3430 | International: +1.443.353.4334 | Fax: 1.410.329.1923 Oxfordclub.com The Oxford Club is a financial publisher that does not offer any personal financial advice or advocate the purchase or sale of any security or investment for any specific individual. Members should be aware that although our track record is highly rated by an independent analysis and has been legally reviewed, investment markets have inherent risks and there can be no guarantee of future profits. The stated returns may also include option trades. We expressly forbid our writers from having a financial interest in their own securities recommendations to readers. All of our employees and agents must wait 24 hours after online publication or 72 hours after the mailing of printed-only publications prior to following an initial recommendation. Any investments recommended by The Oxford Club should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company. Protected by copyright laws of the United States and international treaties. The information found on this website may only be used pursuant to the membership or subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of The Oxford Club, 105 W. Monument Street, Baltimore MD 21201.