A Cringeworthy 362% Payout Ratio ☠️

Recreational vehicles certainly had their moment during the pandemic. But can Camping World maintain its dividend now that sales have slowed? [Shield] AN OXFORD CLUB PUBLICATION [Wealthy Retirement]( [View in browser]( SPONSORED [The #1 Energy Passive Income Investment for 2023]( It's not a stock, bond or private company... But this little-known alternative investment could hand you BIG MONTHLY INCOME from the oil and gas surge in 2023. [CLICK HERE TO FIND OUT WHAT IT IS]( [SAFETY NET]( [Can This 11.6% Yielder Keep Rolling Down the Road?]( [Marc Lichtenfeld, Chief Income Strategist, The Oxford Club]( [Marc Lichtenfeld]( It's no secret that the pandemic was good for recreational vehicle (RV) sales. When no one was flying and everyone was tired of looking at the same walls in their homes, lots of folks took the plunge and bought an RV. Sales for manufacturers and retailers boomed. But in 2022, as things returned to normal, RV sales couldn't keep up their frenetic pace. That makes analyzing the dividend safety of Camping World Holdings (NYSE: CWH) an interesting exercise. Free cash flow exploded in 2020 but dropped dramatically in 2021 and 2022, as the pandemic likely cannibalized sales for several years into the future. However, this year, free cash flow is forecast to spike back to over $400 million. [Chart: Camping World's Cash Flow Is Going in Reverse]( I'm a little skeptical that free cash flow will rocket as high as Wall Street thinks it will, as earnings and revenue are both projected to be lower in 2023. So we have two years of declining free cash flow, which the Safety Net model most definitely does not like. Furthermore, because free cash flow was a minuscule $29 million last year, the $105 million in dividends paid to shareholders gives us a sky-high 362% [payout]( ratio. In other words, for every $1 in free cash flow that Camping World took in, it paid shareholders $3.62. That's not sustainable, and the stock's dividend safety rating gets penalized as a result. SPONSORED [Claim Your 83%-Plus Win Rate GUARANTEE]( [Wednesday Winners]( A former CBOE trader delivers one trade idea every week. He calls them "Wednesday Winners" - due to his impressive win rate on this simple strategy. And even in these volatile markets... his goal is to beat his current 83% win rate! [Watch this immediately.]( However, if free cash flow comes in at even half of the predicted level for this year, it will be more than enough to afford the dividend. Camping World pays a $0.625 per share quarterly dividend, which comes out to a robust 11.6% yield. Additionally, the company often pays special dividends. It did not in 2022 - as last year was a tougher period - but special dividends were somewhat common prior to that. Still, Safety Net does not take special dividends into account. When looking at quarterly dividends only, we see that the company has never cut the dividend since it began paying one in 2016. The falling cash flow and too-high [payout]( ratio mean the dividend safety rating is low. But if free cash flow does significantly improve the way Wall Street expects, the stock could get an upgrade next year. If cash flow doesn't rebound, the current dividend will be in jeopardy. Dividend Safety Rating: D [Dividend Grade Guide]( If you have a stock whose dividend safety you'd like me to analyze, leave the ticker in the [comments]( section. Be sure to check out the Wealthy Retirement website to see whether I've written about the dividend safety of your favorite stock recently. Just click on the word search at the upper right part of the page and type in the name of the company. Good investing, Marc [Leave a Comment]( [Explore the Wonders of Israel, Jordan and Egypt]( RECOMMENDED LINKS [Stock Legend: "Woke Capitalism Is Destroying the Stock Market."]( [If You're 50 or Over, You Will Not See THIS OPPORTUNITY Again in Your Lifetime]( MORE FROM WEALTHY RETIREMENT [Image of the CBOE building]( [The First Thing They Teach You on the CBOE]( [Image of a middle-aged man celebrating at his computer]( [Microcap Stocks: Why You Should Diversify Your Portfolio]( [Image of the Carlyle Group logo on a laptop]( [Carlyle Group: Are Low P/E Ratio Stocks a Good Value?]( [Image of a man stopping dominos from falling]( [How to Reduce Investing Risk With Options Trading]( [Facebook]( [Facebook]( [Twitter]( [Twitter]( [Email Share](mailto:?subject=A%20great%20piece%20from%20Wealthy%20Retirement...&body=From%20Wealthy%20Retirement:%0D%0A%0D%0ARecreational vehicles certainly had their moment during the pandemic. But can Camping World maintain its dividend now that sales have slowed?%0D%0A%0D [Email Share](mailto:?subject=A%20great%20piece%20from%20Wealthy%20Retirement...&body=From%20Wealthy%20Retirement:%0D%0A%0D%0ARecreational vehicles certainly had their moment during the pandemic. But can Camping World maintain its dividend now that sales have slowed?%0D%0A%0D [Push Alert]( [Push Alert]( SPONSORED [Best Time to Buy Tech Stocks Since 2000 (And the #1 Bargain Now)]( [SFT Infinite Energy]( After the tech bubble popped in 2000, there were some amazing bargains available... You could get Amazon for just $6! I believe this time is no different. With the recent tech sell-off, there are some incredible companies trading at discounts we'll never likely see again in our lifetimes. And I believe I have the name of the #1 bargain right now. This is a tiny Silicon Valley company that's using AI to do something incredible. 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