A dividend is a distribution of profits to the shareholders. So when you see dividends that are consistently higher than profits, that’s a problem. It may be a sign that the company is recklessly borrowing to maintain its dividend. That’s a major no-no. In evaluating dividend stocks, you want to see consistent and growing profits that can safely support the dividends being promised. You don’t want to bet your retirement on an income stream that could evaporate tomorrow. Today, we’re going to take a look at 10 dangerous dividend stocks. Some of these are OK to wait out if you already hold, but you should avoid if you don’t. Others should be dumped with haste...
I’ll start with a household name, International Business Machines Corp. (NYSE:IBM). Cloud computing would take a wrecking ball to IBM’s business. Up next is Mattel, Inc. (NASDAQ:MAT). Like IBM, Mattel is getting trounced by its competitors these days. Heavy-duty equipment maker Caterpillar Inc. (NYSE:CAT) is up big in the past year. Its revenues peaked in 2012 and have been in decline ever since. I’d also recommend steering clear of that most venerable of dividend stocks, Marlboro maker Altria Group Inc (NYSE:MO). The crown for the highest-yielding stock on this list of dangerous dividend stocks goes to Frontier Communications Corp (NASDAQ:FTR). At current prices, the stock yields nearly 15% … at least for now. CenturyLink Inc (NYSE:CTL) is in the same boat. As a mid-sized phone and internet provider, CenturyLink operates in slow-growth, low-margin businesses. Staples, Inc. (NASDAQ:SPLS) annual revenues peaked in 2012 and have been drifting lower ever since. Kohl’s Corporation (NYSE:KSS) is another brick-and-mortar retailer with a very uncertain future. Pitney Bowes Inc. (NYSE:PBI) is a survivor, given the decline of “snail mail.” And finally, I’d recommend you be very cautious with British telecom giant Vodafone Group Plc (ADR) (NASDAQ:VOD).
Source: InvestorPlace
Related Articles:
- 4 Communications Services Stocks With Increasing Dividends
- 5 Stocks With Room To Grow Their Dividend
- 9 Dividend Stocks Ignoring The 4% Rule
- 10 Stocks That Have Paid Dividends For Over 100 Years
- Love People, Use Dividend Stocks
________________________________________________________________
Subscribe to:
Post Comments (Atom)
Popular Posts Last 30 Days
-
There are some dividend aristocrats which have not only maintained but increased their dividends for over half a century. Having survived ev...
-
If you want to earn more dividend income from the stock market, then you need to start investing in healthcare. Analysts project the number ...
-
Showing resilience during a tough week was a group of stocks that has not been heard from much in the past two years. A group that has been ...
-
I am going to double down on Exxon Mobil (XOM) this week because I believe investors will have to deal with more market volatility going for...
-
Dividend investing is all about owning investments that pay you — and pay you well — through thick and thin markets. And whether you are bui...
-
High dividend yields are harder to find lately, given the long-running stock market rally. But that scarcity doesn't mean investors have...
-
The U.S. boosted tariffs on $200 billion worth of Chinese goods from 10% to 25%. The markets had expected this to be the week that this deal...
-
One little-known tax loophole allows Americans to collect large, growing distribution checks from the government. And investors can begin ea...
-
Utility stocks were supposed to be yesterday’s favorite investment. The theory regarding utility stocks was simple: Robust economic growth c...
-
Technology is the alchemy of the stock market. It is where companies turn worthless silicon into incredible new and expensive gizmos and dev...
I'm not crazy about TGT and think it trades lower. After the whole bathroom deal, they've alienated a massive number of customers. I don't trust any management that creates unnecessary drama.