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There's a similar situation brewing in shares of
Harsco(HSC - Get Report), a $1.68 billion industrial services firm. Harsco's businesses include servicing metals and minerals miners, maintaining railroads, and engineering scaffolding. While that diversification is a plus for shareholders, it didn't really help to lessen the blow that the whole industrial segment took during the Great Recession.
But in spite of sales and earnings numbers that are still well short of the numbers that the company booked back in 2008, the firm has been steadily increasing its dividend payout. As a result, the firm has paid out $1.74 more per share in dividends over the last 12 months than it's actually earned, a pattern that's only sustainable for so long.
Even though Harsco has decent balance sheet liquidity, it also carries far more debt. Just like Windstream, something has to give eventually. Either Harsco drops its dividend, or it goes looking for capital in another, more painful, way.
Currently, Harsco pays out 20.5 cents per share. That's nearly a 4% yield at current price levels.