Are These 5 Dividends Ready to Crumble?: Atlantic Power Corp (AT), Exelon Corporation (EXC)

Source: Yahoo! Finance.

Atlantic Power’s self-investment blows away the competition, but its heavy spending doesn’t sync up with its high dividend. FirstEnergy comes in last but still justifies its sizable 5.3% dividend yield — so long as it’s not scrimping on necessary spending.

Now that we know whether each company is attempting to deliver shareholder value through self-investment, let’s see if they havecash left over to dispense their dividends:

AT Cash Div. Payout Ratio TTM data. Sources: YCharts and author’s calculations

The proof is in the pudding, or, in this case, the cash dividend payout ratio. The spread on these companies is enormous and reveals the lengths to which come companies will go to satisfy dividend investors’ appetites. Southern is currently paying out 854% of its available cash in dividends, while Exelon coughs up 171% of its piggy bank. Atlantic and FirstEnergy both have negative cash flows, which makes National Grid the only utility with true dividend staying power.

Dividend dough
Having taste-tested our different dividends, you can see how some seemingly sweet deals could leave investors with a sour taste in their mouths. It seems backwards, but dividend-slashing National Grid and soon-to-slash Exelon appear to have the best dividends around. Contrarily, Atlantic shareholders need to watch their dividend with a wary eye, as their profits might soon be burned to a crisp.

The article Are These 5 Dividends Ready to Crumble? originally appeared on Fool.com and is written by Justin Loiseau.

Fool contributor Justin Loiseau has no position in any stocks mentioned, but he does use electricity. You can follow him on Twitter, @TMFJLo, and on Motley Fool CAPS, @TMFJLo. The Motley Fool recommends Exelon, National Grid, and Southern.

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