VVR: The Dividend Needs To Be Cut To Slow NAV Erosion
Invesco Senior Income Trust (VVR) is facing significant challenges due to ongoing net asset value (NAV) erosion and an unsustainable dividend yield. The current yield of 11.6% is not supported by the fund's earnings, which have fallen short of payouts. A recommendation has been made to cut the dividend by up to 50% to help stabilize the fund's financial situation.
- ▪Invesco Senior Income Trust (VVR) has a high yield of 11.6% that is unsupported by its earnings.
- ▪Recent annual earnings for VVR were only $0.09 per share, significantly lower than current payouts.
- ▪The fund's heavy exposure to below-investment-grade and unrated floating rate debt increases its risk in a high-rate environment.
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