Fiat Chrysler Shares Decline on Dividend Payout Withdrawal

Fiat Chrysler Automobiles (FCAU) and PSA Groupe, owner of Peugeot S.A., said in a joint statement that they each decided to scrap their planned ordinary dividend on 2019 results due Read More... The post Fiat Chrysler Shares Decline on Dividend Payout Withdrawal appeared first on TipRanks Financial Blog.

Fiat Chrysler Shares Decline on Dividend Payout Withdrawal

Fiat Chrysler Automobiles (FCAU) and PSA Groupe, owner of Peugeot S.A., said in a joint statement that they each decided to scrap their planned ordinary dividend on 2019 results due to the impact of the coronavirus pandemic. Shares in Fiat Chrysler dropped 3.7% to $7.60 in U.S. trading.

At the end of last year, Fiat Chrysler Automobiles and PSA had announced a 1.1 billion euro ($1.19 billion) ordinary dividend for both.

The cash preservation measure comes as the two automakers at the end of last year entered into a proposed merger agreement to create the world’s fourth-largest automaker with a combined market value of about $50 billion.

Large corporates from General Motors (GM) to Royal Dutch Shell have in recent weeks cut dividend payout plans to shareholders to preserve their cash coffers as they grapple with the financial fallout caused by the lockdown orders implemented by governments around the world to contain the fast spread of the coronavirus pandemic. Car makers have posted large losses as the stay-at-home orders have forced a shutdown of their showrooms and led to production disruptions.

The two automakers updated investors that “preparations for the 50/50 merger of their businesses are advancing well, including with respect to antitrust and other regulatory filings.”

In addition, the two companies said they were on track to complete the proposed merger before the end of the first quarter of 2021, subject to customary closing conditions.

EU antitrust regulators said this week that a decision about the merger will be announced by June 17.

The coronavirus pandemic has wiped off almost 50% of Fiat Chrysler’s share value so far this year.

Overall Wall Street analysts are cautiously optimistic about Fiat Chrysler’s stock. The Moderate Buy consensus consists of 4 Buys, 2 Holds and 1 Sell. The $10.80 average price target indicates shares have room to soar 39% in the coming 12 months. (See Fiat Chrysler stock analysis on TipRanks).

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The post Fiat Chrysler Shares Decline on Dividend Payout Withdrawal appeared first on TipRanks Financial Blog.

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3 million more unemployment claims as real jobless rate soars to Great Depression levels

The latest batch of claims represents the sixth consecutive weekly drop—but is still more than four times higher than the pre-pandemic record of 695,000.

3 million more unemployment claims as real jobless rate soars to Great Depression levels

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More than 2.98 million Americans filed initial unemployment claims in the week ending May 9, according to the U.S. Department of Labor. That brings the total unemployment claims over the past eight weeks to 36.5 million.

The almost 3 million jobless claims represents the sixth consecutive weekly drop in claims, but were down from 3.2 million the week prior. However, it is still more than four times higher than the previous pre-pandemic record from October 1982 of 695,000 claims. That former record has been topped for eight weeks straight.

Over the past week, Connecticut and Georgia lead the nation with 298,680 and 241,387 claims, respectively.

The 14.7% unemployment rate released by the U.S. Bureau of Labor Statistics only represents the period tracked through mid-April. Since then, another 10 million Americans have claimed unemployment benefits. When those 10 million are added to the already 23.1 million unemployed Americans in the latest jobs reports, it brings the total unemployed over 33 million. That would be a real unemployment rate of 21.1%—compared to the Great Depression peak of 25.6%.

But not all of these Americans claiming unemployment benefits will get added into the official unemployment rate: Only out-of-work Americans who are searching for new positions are categorized as unemployed and in the labor force. And many jobless workers are choosing to wait out the virus and stay-at-home order before starting their search.

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