The Highest-Yielding Stock in the S&P 500 Just Slashed Its Dividend by 50%. The Surprising Reason Why It Could Be a Buy Now.

An unsustainable payout As shown in the following chart, Dow's earnings per share (EPS) and free cash flow (FCF) increased significantly during 2021 and 2022, as demand recovered from the pandemic and a supply-demand imbalance emerged in the commodity chemical industry. However, EPS and FCF have been tumbling for years now. The situation has deteriorated further as Dow's EPS and FCF have turned negative. Even after cutting its dividend, chemical giant Dow still yields 5.5%. Chemical giant Dow (DOW -2.63%) f ...