Dividends4Life: Europe Kill These Dividend Stocks?

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Europe Kill These Dividend Stocks?

Posted by D4L | Monday, July 09, 2012 | | 0 comments »

Now I want to look at names that should be sold to Euro-proof one’s portfolio. This weekend presents yet another EU Summit with the likely outcome a bunch of headline quotes, but no on-the-ground action to stem the sinking economic outlook in the region. This dynamic should raise a red flag on equities that are vulnerable to European weakness. Investors should not automatically take a “buy-the-dip” mentality and should reduce exposure until a clear path to improvement is evident. Capital preservation or rotating into more domestically focused industries and stocks remains the most suitable path for the remainder of the year and possibly for several more years.

Below are four higher yielding dividend stocks that could very well underperform in the coming months as the European situation deteriorates: McDonald’s Corp (NYSE: MCD), Energizer Holdings (NYSE: ENR), Cliffs Natural Resources (NYSE: CLF) and Freeport-McMoRan Copper & Gold (NYSE: FCX). Be mindful of a company’s European exposure before diving in. These links can take many forms from direct sales in the region to strong dependence on currency movements.

Source: Motley Fool

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