A Little Unexpected Windfall

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From time to time, companies either need to unload cash or something else happens that they feel more is due to shareholders than their typical dividend. They are most often referred to as "supplemental dividends." One such announcement was recently made by Ford Motor Company, who declared their usual current 15 cent quarterly dividend, but also announced a 65 cent per share supplemental dividend. So, that's a bit of an unexpected windfall. Also, a surprising one considering when Ford just reported earnings, showing it missed earnings targets by over $1 billion citing supply chain issues and supply costs. The supplemental dividend is in contrast a bit, being paid from strong cash flow, despite the earnings miss, and from monetization of their stake in Rivian. The stock itself may take a short term hit due to the missed earnings. but CEO Jim Farley has told shareholders he will be taking swift action to improve margins and reduce costs in order to better meet its financial objectives. As he put it, "It is something we MUST do. And immediately." Disclosure: Porwest owns shares in Ford Motor Company and intends to add future shares.