{"id":22345,"date":"2025-10-30T03:12:57","date_gmt":"2025-10-30T03:12:57","guid":{"rendered":"https:\/\/finderica.com\/?p=22345"},"modified":"2025-10-30T03:12:57","modified_gmt":"2025-10-30T03:12:57","slug":"is-bg-foods-17-yield-delicious-or-dangerous","status":"publish","type":"post","link":"https:\/\/finderica.com\/?p=22345","title":{"rendered":"Is B&G Foods\u2019 17% Yield Delicious… or Dangerous?"},"content":{"rendered":"
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B&G Foods<\/strong> (NYSE: BGS) is a company you may not know, but you are likely familiar with some of its more than 50 brands, including Crisco, Ortega, and Green Giant.<\/p>\n

Income investors may have seen B&G come across their radar thanks to the stock\u2019s sky-high 17% dividend yield.<\/p>\n

But is that dividend as reliable as a bowl of the company\u2019s Cream of Wheat hot cereal?<\/p>\n

We\u2019ll dig into the numbers in just a minute, but first, a word of caution: Anytime you see a dividend yield that high, your guard should be up. It doesn\u2019t automatically mean that the dividend is unsafe or that the stock is a dog, but the risk of both is certainly elevated.<\/p>\n

One reason B&G Foods\u2019 yield is so high is that the stock has been a disaster. It\u2019s been just about cut in half in the past year and is down more than 80% over the past five years.<\/p>\n

Part of the problem is that cash flow has been very inconsistent.<\/p>\n

Last year, it slid 54% from $222 million to $103 million. This year, it is forecast to drop another 10% to $93 million.<\/p>\n

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<\/a>The Safety Net model penalizes stocks for declining free cash flow. The reasoning is very simple: You want to see cash flow growth in order to boost your confidence that the company will be able to afford its dividend in the future.<\/p>\n

The good news is that B&G\u2019s payout ratio is low enough to not set off any alarms.<\/p>\n

Last year, the company paid out 58% of its cash flow in dividends. This year, that number is forecast to remain the same.<\/p>\n

In late 2022, B&G Foods slashed its quarterly dividend from $0.475 to the current $0.19. Once a management team has shown a willingness to cut the dividend, the payout is no longer sacrosanct, and investors should be on guard that it could happen again.<\/p>\n

The saving grace for the company\u2019s dividend safety rating is that the payout ratio is reasonable. But if cash flow continues to deteriorate, it could become a problem.<\/p>\n

B&G Foods\u2019 dividend has a high risk of being cut.<\/p>\n

Dividend Safety Rating: D<\/strong><\/p>\n

\"Dividend<\/p>\n

What stock\u2019s dividend safety would you like me to analyze next? Leave the ticker in the comments section.<\/p>\n

You can also take a look to see whether we\u2019ve written about your favorite stock recently. Just click on the word \u201cSearch\u201d at the top right part of the Wealthy Retirement<\/em> homepage, type in the company name, and hit \u201cEnter.\u201d<\/p>\n

Also, keep in mind that Safety Net can analyze only individual stocks, not exchange-traded funds, mutual funds, or closed-end funds.<\/p>\n<\/p><\/div>\n