Danaher cuts dividend by 21.9% following Fortive spin-off

Danaher Corp (DHR) will cut its quarterly dividend to $0.125 per share. In February Danaher had raised its dividend for the third consecutive year.

The dividend cut is a surprise given the low payout ratio Danaher had, even following the Fortive spin-off.

Given the fact that Fortive initiated a $0.07 per share dividend this August, Danaher shareholders receive the same amount based on the estimated  annual $97 million payout by Fortive. If added to Danaher's current $344 million annual dividend the dividend stays unchanged from the amount prior to the Fortive spinoff.

However Danaher shareholders do get a dividend cut from $0.16 to $0.125 per share on a quarterly basis. It's remarkable that the management didn't decide to keep its quarterly payment unchanged because of the already low dividend yield and payout ratio

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