15 Dividend Cuts and Suspensions Chalked Up to the Coronavirus
Most investors buy dividend stocks for the consistent income they generate. Whether we're talking about Achievers, Aristocrats or Kings, or just plain ol' dividend payers, their income provides certainty in an uncertain world.
That is, of course, until the dividend cuts and suspensions start rolling in.
The global COVID-19 coronavirus pandemic has thrown a wrench into corporate dividend programs as companies of all sizes scramble to raise cash and fortify their finances. As the coronavirus has gained momentum here in the U.S., dividend investors have become concerned about the sustainability of their regular income payments - and rightly so.
Inevitably, just like the Great Recession of 2008, companies one by one have begun suspending or cutting their dividends as part of their plan to fight the negative effects of this pandemic on their businesses.
Here are 15 dividend stocks that have recently announced dividend cuts or suspensions, and what they plan to do to keep operations running until they get through to the other side. As you'll soon see, some industries have been more swiftly and severely impacted than others.
Boeing
Market value: $101.9 billion
Action: Dividend suspension
Annual dividend prior to change: $8.22 per share
Boeing (BA, $180.55) sought out tens of billions of dollars in U.S. government loan guarantees to prop up the company and its supply chain. Thus, many already expected BA to announce dividend cuts or a suspension. Boeing broke the news March 20, saying it had paused its payout and would continue a hold on its stock buybacks that began in April 2019.
CEO Dave Calhoun and Board Chairman Larry Kellner will forgo all compensation until the end of 2020, too.
The company's quarterly dividend of $2.055 per share would have represented a healthy 4.6% annual yield at current prices. In 2019, Boeing paid out $4.6 billion in dividends. Unfortunately, it had operating cash flow of negative $2.4 billion last year - a complete reversal from 2018, when it achieved record cash flow of $15.3 billion - thanks in large
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