Fielmann shares: From dividend success to price correction in 2020 - How investors can benefit.

Fielmann shares: From dividend success to price correction in 2020 - How investors can benefit.

According to a report from amp2.wiwo.de, eyewear retailer Fielmann experienced a tough turnaround in 2020 after two decades of reliable dividend increases. The pandemic forced the company to drastically reduce its profit distribution. This led to a decline in the dividend to 75 cents in 2023. Payout ratios were already too generous, creating a challenge for the company amid rising costs and competitive pressures.

However, the initial situation for investors at Fielmann is promising. Sales should increase again and earnings per share should exceed pre-pandemic levels. Analysts expect sales of 2.3 billion euros next year and earnings per share of 2.13 euros. The company is also planning extensive job cuts to improve profitability. In addition, the Fielmann family owns over two thirds of the shares and has a strong interest in the long-term success of the company.

The reduced dividend could even be an advantage for investors, as the stock is currently cheaper than it was a few years ago and offers a similarly high dividend yield. In addition, more modest dividend distributions make it possible to free up capital for investments.

The Fielmann example shows that even seemingly solid dividend stocks are subject to unpredictable changes and investors should therefore always pursue a cautious strategy.

Furthermore, it is important to understand that companies with strong market positions and clear growth prospects, as is the case with Fielmann, can promise renewed dividend growth despite temporary difficulties. This could provide investors with attractive distributions in the long term.