98% of Dividend Cuts Avoided in Advance

B&G Foods (BGS) slashed its dividend by 60%. Rising interest rates, substantial raw material inflation, and tighter consumer spending led the retail foods maker to substantially reduce its dividend in order to protect the balance sheet.

Lumen (LUMN) suspended its dividend. The telecom provider's ambitious fiber internet growth investments strained free cash flow and pressured the firm's junk-rated balance sheet. Eliminating the payout preserves cash for debt reduction and growth spending.

Sachem (SACH) lowered its dividend by 7%. The mortgage REIT's payout ratio exceeded 100%, with higher borrowing costs applying additional pressure to future dividend coverage.

Fortress Transportation (FTAI) cut its dividend by 9%. The firm spun off its infrastructure business, resulting in less cash flow going forward. The partnership also plans to convert to a corporation.

Invesco Mortgage Capital (IVR), a residential mortgage REIT, slashed its dividend by 28%. Sharply higher interest rates pressured the firm's book value and leverage as the value of its mortgage-backed securities declined.

Chimera (CIM) cut its dividend by 30%. The residential mortgage REIT's earnings were pressured by the sharp jump in interest rates, which increase Chimera's borrowing costs.

Steelcase (SCS) reduced its dividend by 31%. The furniture maker experienced a volume decline in orders and wanted to conserve more cash in light of lower than expected return-to-office trends in the Americas.

American Eagle (AEO) suspended its dividend. The apparel retailer, faced with excess inventory and uneven demand patterns, desired to prioritize liquidity and financial flexibility in the near term.

Orchard Island Capital (ORC) slashed its dividend by 29%, marking the residential mortgage REIT's third cut in 2022. With the spread between long-term and short-term interest rates continuing to narrow, Orchard's profits and dividend coverage remained under pressure.

Mativ (MATV) lowered its dividend by 9%. Formed by the merger between specialty materials manufacturers Schweitzer-Mauduit and Neenah, Mativ needs to prioritize debt reduction.

Mercury General (MCY) cut its dividend by 50%. The auto insurer faced high loss ratios as elevated inflation rates significantly increased the cost to settle claims. While Mercury remains well capitalized, management desired to take a more conservative stance with the dividend in response to the plunge in profits.

Industrial Logistics Properties Trust (ILPT) slashed its dividend by 97%. The industrial REIT's leverage spiked after acquiring peer Monmouth earlier in 2022. With interest rates rising and financing plans such as asset sales no longer practical with the market slumping, ILPT's dividend cut helped preserve liquidity until conditions could later improve. Shares of ILPT slumped over 20% on the news.

National CineMedia (NCMI) reduced its dividend by 40%. The owner of the largest cinema advertising network in the U.S. continued battling operating losses and a stretched balance sheet due to the pandemic's effects.

Ellington Residential Mortgage REIT (EARN) cut its dividend by 20%. Rising interest rates pressured the firm's net interest margin, core earnings, and dividend coverage.

Orchard Island Capital (ORC) lowered its dividend by 18%, marking the residential mortgage REIT's second cut in three months. With the spread between long-term and short-term interest rates continuing to narrow, Orchard's profits and dividend coverage remained under pressure.

Lument Finance Trust (LFT) slashed its dividend by 33%. Following dilutive capital raises and faced with rising borrowing costs, the small commercial mortgage REIT cut its payout to ensure the dividend remains covered as Lument scales its portfolio.

Owens & Minor (OMI) suspended its dividend. The medical supplies distributor was paying a paltry dividend after having axed its payout in 2018, when Owens & Minor had a Very Unsafe rating. Management opted to eliminate the dividend entirely to prioritize growth investments going forward.

PPL (PPL) lowered its dividend by 52%, reflecting the sale of its U.K. utility business. The regulated utility rebased its dividend to reflect the ongoing earnings generated by its remaining operations in Kentucky and Pennsylvania. Back in March 2021, when PPL found a buyer for its U.K. assets, we estimated a dividend cut upwards of 50% was likely.

Orchard Island Capital (ORC) reduced its dividend by 15%. The residential mortgage REIT saw its net interest margin compress as the spread between long-term and short-term interest rates narrowed, reducing profits and weakening dividend coverage.

Compass Diversified (CODI) cut its dividend by 31%. The acquirer of niche industrial and consumer firms elected to be taxed as a corporation rather than a partnership, expanding its potential shareholder base but necessitating a dividend cut as the firm must now use some cash flow to pay income taxes.

Compass Minerals (CMP) slashed its dividend by 79%. After discovering a significant lithium resource, the salt and fertilizer producer wanted to direct more cash flow towards developing this mineral site to focus on growing and diversifying the business faster.

Sprague Resources LP (SRLP) cut its distribution by 35%. The wholesale provider of refined products and natural gas needed to improve its distribution coverage ratio as it invested more in growth projects and desired to maintain its leverage ratio target.

CatchMark Timber Trust chopped its dividend by 44%, sending its shares falling over 20%. The timberland REIT's stretched balance sheet and elevated payout ratio drove the cut after CatchMark exited a poorly performing joint venture.

Höegh LNG Partners LP (HMLP) slashed its distribution by 98%. The owner and operator of liquefied natural gas carriers needed to conserve cash after facing refinancing challenges related to its credit facility.

Shell Midstream Partners, L.P. (SHLX) cut its distribution by 35%. The pandemic hurt demand for transporting and storing crude oil and refined products, causing Shell Midstream's payout ratio to rise to unsustainable levels.

National Health Investors (NHI) cut its dividend by 18%. The healthcare REIT's senior housing and skilled nursing tenants faced a challenging environment caused by the pandemic. Lowering the dividend will enable NHI to provide more support to its tenants.

AT&T (T) announced plans to reduce its dividend in mid-2022. This will occur after AT&T combines its WarnerMedia business (around 20% of cash flow) with rival Discovery to form a new publicly traded company, which will be 71% owned by AT&T shareholders.

Unwinding AT&T's sprawling operations will result in a dividend cut since the new media business will not pay dividends. Based on management's payout ratio guidance for AT&T's remaining business, we expect the firm's dividend to be cut by around 40%.

AT&T had a Borderline Safe Dividend Safety Score prior to this news, reflecting its stable cash flow but elevated debt load. While AT&T did not have to reduce its dividend, management ultimately decided to reverse the firm's prior strategy to create the largest vertically integrated content and distribution company.

These moves will hopefully position AT&T for a more conservative and predictable future that has potential to deliver stronger total returns.

HollyFrontier (HFC) temporarily suspended its dividend to fund an acquisition, breaking its 25-plus year streak of uninterrupted payouts. Management plans to reinstate the dividend at its previous rate within one year.

Anticipating this action was challenging since the firm did not need to make an acquisition and had not telegraphed any plans to do so. Instead, this was primarily an opportunistic purchase that came at "a very good price," according to management.

Funding the deal by temporarily eliminating the dividend was also a decision that involved a lot of discretion. HollyFrontier has the lowest leverage ratio across its peer group and had more than enough liquidity to fund the entire acquisition several times over.

Management ultimately opted to take a very conservative approach to ensure HollyFrontier maintains its BBB- investment-grade credit rating while continuing to invest in its business.

Navios Maritime Acquisition (NNA), an owner and operator of tanker vessels, suspended its dividend to preserve cash as the business struggled with too much debt and weak freight rates caused by the pandemic.

GEO Group (GEO) suspended its dividend. The private prison REIT needed to maximize its use of cash flow for debt reduction in light of an increasingly challenging political environment.

Bayer (BAYRY) cut its dividend by 29%. The German manufacturer of crop chemicals and pharmaceuticals needed to prioritize protecting its balance sheet after making a costly acquisition and facing substantial legal liabilities tied to Roundup, a popular weedkiller product.

Antero Midstream (AM) lowered its dividend by 27%. The pipeline company faced upward pressure on its capital budget after its sole customer, natural gas producer Antero Resources, entered into a new drilling agreement. Reducing the dividend will ensure that Antero Midstream's free cash flow will cover both its capital expenditures and dividend payments going forward.

Healthpeak Properties (PEAK), a healthcare REIT, reduced its dividend by 19%. Management desired to right-size the firm's payout ratio as Healthpeak divested its senior housing properties and gradually reinvested the proceeds to rebuild its cash flow.

NGL Energy Partners LP (NGL) suspended its distribution. The midstream MLP needed to refinance some of its debt, and NGL's lenders required the firm to eliminate distributions until its high leverage was reduced to a safer level.

GlaxoSmithKline (GSK) announced plans to reduce its dividend beginning in 2022 after it completes the separation of its consumer health business (about 30% of sales). We estimate the firm's aggregate distributions will fall by around 30% once both companies' new dividend policies go into effect, reflecting management's desire to run the business with a lower payout ratio.

GEO Group (GEO), one of the largest operators of privately managed prisons in America, cut its dividend by 27%. This marked the firm's second dividend reduction in six months as management further prioritized debt reduction in light of an increasingly challenging political climate. 

RioCan (RIOCF) cut its dividend by 33%. The Canadian retail REIT in May 2020 had assured investors it would not cut its dividend but changed course as the pandemic dragged on. A smaller dividend will provide RioCan with a more conservative payout ratio while freeing up more cash flow for portfolio investments and debt reduction.

Navios Maritime Acquisition (NNA), an owner and operator of tanker vessels, cut its dividend by 83% to preserve cash as the business struggled with too much debt.

SFL Corporation (SFL) cut its dividend by 40%. SFL owns a fleet of tankers, container vessels, and offshore drilling rigs. An offshore customer is exploring bankruptcy, hurting SFL's cash flow outlook and driving the dividend reduction. 

GasLog Partners LP (GLOP) slashed its distribution by 92%. The owner and operator of liquefied natural gas carriers faced challenging market conditions and needed to prioritize deleveraging its balance sheet. Shares fell more than 30% on the news.

Anheuser-Busch InBev (BUD) suspended its dividend. The global brewer opted to forego its next semi-annual dividend payment to prioritize deleveraging efforts, which were slowed by the COVID-19 pandemic. However, given expectations for improving results, management kept the door open to pay a final 2020 dividend with a decision expected in February 2021.

NGL Energy Partners LP (NGL) cut its distribution by 50%. The diversified midstream energy company was saddled with debt and needed to improve its leverage profile as it worked with its bank group to extend the expiration date of its credit facility. Lower the distribution, which was otherwise well covered by cash flow, will help with debt reduction.

Energy Transfer (ET), a major provider of midstream energy services, cut its distribution by 50%. The firm faced mounting pressure to protect its BBB- credit rating as domestic energy production declined and weak commodity prices hurt shale producers. Reducing the distribution frees up more cash for debt reduction and brings the firm closer to covering all of its distribution and capital spending needs with internally generated cash flow only.

CVR Energy (CVI) suspended its dividend. The petroleum refiner and nitrogen fertilizer manufacturer was losing money as the pandemic sapped gasoline demand. 

Empire State Realty Trust (ESRT), a pure-play Manhattan and greater New York metropolitan area REIT, suspended its dividend. Management wanted to preserve the firm's financial flexibility given the unprecedented amount of uncertainty created by COVID-19, especially for its flagship property the Empire State building.

Pennsylvania Real Estate (PEI) suspended its dividend. The distressed shopping mall REIT had previously cut its dividend by 90% in March as the pandemic upended its business.

Macerich (MAC) cut its dividend by 70%, marking the mall REIT's second payout reduction in less than six months. Low rent collection rates and the firm's weak balance sheet forced the firm to preserve more capital in order to maintain financial flexibility during a period of intense uncertainty.

Garrison Capital (GARS), a business development company, reduced its dividend by 67%. Net investment income did not cover the dividend due to lower interest rates, credit-related losses, and high transaction costs as part of Garrison's proposed merger.

GEO Group (GEO), one of the largest operators of privately managed prisons in America, cut its dividend by 29%. Management decided to prioritize debt reduction as more lenders refuse to work with companies that manage private prisons and immigration detention centers.

BP (BP) cut its dividend by 50%. The plunge in energy prices strained the oil giant's cash flow and leverage. Reducing the dividend enables BP to protect its balance sheet and free up more capital for investment in lower-carbon energy.

Blackrock TCP Capital (TCPC) lowered its dividend by 17%. Falling interest rates pressured the business development company's net investment income and payout ratio.

Ciner Resources LP (CINR) suspended its distribution. The soda ash manufacturer faced weaker demand due to the pandemic, causing its markets to become oversupplied. With its operating losing money and leverage rising, management opted to eliminate the distribution.

Capital Product Partners LP (CPLP), a shipping company, cut its distribution by 71%. The pandemic increased crew expenses and hurt global trade, reducing shipping rates and container prices.

Wyndham Destinations (WYND) cut its dividend by 40%. The world's largest vacation ownership and exchange company was strained by the plunge in travel and tourism caused by the pandemic.

Vornado Realty (VNO) cut its dividend by 20%. The New York-focused office and retail REIT desired to preserve liquidity in this time of crisis.

Boston Private (BPFH) slashed its dividend by 50%. The provider of private banking and wealth management services opted to rightsize its payout ratio as it braced for pandemic-related loan losses.

Cypress Environment Partners (CELP) suspended its distribution due to challenges in the energy industry. The master limited partnership generated most of its cash flow from providing inspection services for energy infrastructure assets such as pipelines.

Martin Midstream Partners (MMLP) chopped its distribution by 92%. New leverage covenant conditions at the partnership's revolving credit facility forced the midstream services provider to cut its payout.

Suburban Propane Partners (SPH) slashed its distribution by 50%. The propane distributor desired to accelerate its debt reduction efforts in light of elevated demand uncertainty created by COVID-19.

Capital One (COF) cut its dividend by 75%. While the bank remains well capitalized, the Federal Reserve's new income limitation rule placed on America's largest financial institutions forced Capital One to reduce its payout. 

The Fed said dividends cannot exceed an amount equal to the average of the firm's net income for the four preceding quarters. Capital One recorded a large provision for credit losses in the second quarter, causing its trailing payout ratio to exceed 100%.

Stellus Capital (SCM), a business development company, cut its dividend by 26%. Falling interest rates pushed the firm's payout ratio above 100%, so lowering the dividend better aligns it with earnings going forward.

MV Oil Trust (MVO), which owns interests in oil and gas wells, suspended its distribution. Weak energy prices drove a net loss for the firm.

Dominion Energy (D) expects to reduce its dividend by 33% beginning in the fourth quarter of 2020. Management decided to sell the utility's natural gas and transmission storage business, which generated nearly 25% of Dominion's earnings. This reduction in cash flow drove the decision to rightsize the dividend.

Given the discretionary nature of this strategic decision to change Dominion's long-term business mix, we aren't sure there was much we could've done to get ahead of this cut. 

Dominion's earnings were growing at a mid-single-digit pace, the dividend remained covered by earnings, liquidity was solid, the firm's investment-grade credit rating was stable, the pandemic's impact appeared limited, and Dominion's midstream business had a steady outlook.

Shares of Dominion fell around 11% on the news but had recovered all of their losses by the end of the month.

Simon Property Group (SPG), an owner and operator of malls around the world, cut its dividend by 38% as the coronavirus pandemic hit mall tenants hard, many of whom were already struggling due to the rise of e-commerce.

Wells Fargo (WFC) cut its dividend by 80%. While the bank remains well capitalized, the Federal Reserve's new income limitation rule placed on America's largest financial institutions forced Wells Fargo to reduce its payout. 

The Fed said dividends cannot exceed an amount equal to the average of the firm's net income for the four preceding quarters. Wells Fargo's payout ratio was above 100% as the firm's earnings were suppressed by rising loan loss provisions and high legal costs related to its sales scandal.

Ventas (VTR), the second largest medical REIT in the U.S., cut its dividend by 43%. Ventas owns and operates senior housing facilities, which were faced with unprecedented challenges and cost increases resulting from the coronavirus pandemic.

Armanino Foods of Distinction (AMNF) cut its dividend by 36%.

Cherry Hill Mortgage Investment Corporation (CHMI) cut its dividend by 33%.

Kite Realty Group Trust (KRG) slashed its dividend by 84%.

CoreCivic (CXW) suspended its dividend.

Apollo Commercial Real Estate Finance (ARI) reduced its dividend by 13%.

Ready Capital Corporation (RC) cut its dividend by 37.5%.

Redwood Trust (RWT) cut its dividend by 61%.

Crown Crafts (CRWS) suspended its dividend.

Chimera Investment Corporation (CIM) cut its dividend by 40%.

Dynex Capital (DX) reduced its dividend by 13%.

Annaly Capital Management (NLY) reduced its dividend by 12%.

Urstadt Biddle Properties (UBP) slashed its dividend by 75%.

Xinyuan Real Estate (XIN) cut its dividend by 75%. The residential real estate developer based in China experienced a delay in project construction sales due to nationwide lockdowns, putting additional pressure on its high payout ratio and financial leverage. 

Taubman Centers (TCO), a mall REIT, suspended its dividend. The pandemic forced many retailers to temporary close, causing landlords' rent collection rates to plunge. 

AMC Entertainment Holdings (AMC), a nationwide operator of movie theaters, suspended its dividend. AMC was burning through cash after theaters closed due to the COVID-19 pandemic, and the firm needed to remain in compliance with debt covenants.

PennantPark Investment Corporation (PNNT) cut its dividend by 33%.

Oxford Square Capital Corp. (OXSQ) cut its dividend by 48% as the value of the business development company's portfolio of loans fell sharply and steep losses were expected.

Flexsteel Industries (FLXS) slashed its dividend by 77%.

Occidental Petroleum Corporation (OXY) slashed its dividend by an additional 91%. The oil and gas producer had originally announced a dividend cut in early March but reduced the dividend even further as conditions continued to deteriorate.

Lamar Advertising Company (REIT) (LAMR) cut its dividend by 50%.

Valhi (VHI) cut its dividend by 67%.

DXC Technology Company (DXC) suspended its dividend.

Ladder Capital Corp (LADR) cut its dividend by 41%.

Big 5 Sporting Goods Corporation (BGFV) suspended its dividend.

Ralph Lauren Corporation (RL) suspended its dividend.

Elbit Systems Ltd. (ESLT) reduced its dividend by 20%.

Foot Locker (FL) suspended its dividend.

America First Multifamily Investors (ATAX) slashed its dividend by 77%.

Braemar Hotels & Resorts (BHR) suspended its dividend.

TJX Companies (TJX) suspended its dividend.

Ross Stores (ROST) suspended its dividend.

Abercrombie & Fitch Co. (ANF) suspended its dividend.

Grupo Televisa, S.A.B. (TV) suspended its dividend.

Elmira Savings Bank (ESBK) cut its dividend by 35%.

National Oilwell Varco (NOV) suspended its dividend.

Halliburton Company (HAL) slashed its dividend by 75%.

Deutsche Bank Aktiengesellschaft (DB) suspended its dividend.

Imperial Brands PLC (IMBBY) cut its dividend by 33%.

ARMOUR Residential REIT (ARR) slashed its dividend by 82%.

VEREIT (VER) cut its dividend by 44%.

PBF Logistics LP (PBFX) cut its dividend by 42%.

PBF Energy Inc (PBF) suspended its dividend.

Melco Resorts & Entertainment Limited (MLCO) suspended its dividend.

Strattec Security Corporation (STRT) suspended its dividend.

International Game Technology PLC (IGT) suspended its dividend.

Linamar Corporation (LIMAF) cut its dividend by 50%.

Penske Automotive Group (PAG) suspended its dividend.

Psychemedics Corporation (PMD) suspended its dividend.

Ituran Location and Control Ltd. (ITRN) suspended its dividend.

Cantel Medical Corp. (CMD) suspended its dividend.

Medley Capital Corporation (MCC) suspended its dividend.

Rocky Mountain Chocolate Factory (RMCF) suspended its dividend.

Preferred Apartment Communities (APTS) cut its dividend by 31%.

Xenia Hotels & Resorts (XHR) suspended its dividend.

Tanger Factory Outlet Centers (SKT) suspended its dividend. The owner of outlet malls needed to preserve its balance sheet and maintain financial flexibility. Many of Tanger's retail tenants were struggling before the pandemic, and government-mandated shutdowns for non-essential stores served as the nail in the coffin for some of them and the dividend.

Salem Media Group (SALM) suspended its dividend.

RPT Realty (RPT) suspended its dividend.

Ethan Allen Interiors (ETH) suspended its dividend.

OFS Capital Corporation (OFS) cut its dividend by 50%.

Monroe Capital Corporation (MRCC) reduced its dividend by 29%.

New Senior Investment Group (SNR) cut its dividend by 50%.

U.S. Silica Holdings (SLCA) suspended its dividend.

Outfront Media (OUT) suspended its dividend.

Summit Midstream Partners (SMLP) suspended its dividend.

Domtar Corporation (UFS) suspended its dividend.

Kimco Realty Corporation (KIM) suspended its dividend.

Colony Capital (CLNY) suspended its dividend.

BT Group (BT) suspended its dividend.

THL Credit (TCRD) cut its dividend by 52%.

ArcelorMittal (MT) suspended its dividend.

Kingstone Companies (KINS) cut its dividend by 37%.

ProAssurance Corporation (PRA) slashed its dividend by 84%.

Weingarten Realty Investors (WRI) cut its dividend by 55%.

Manhattan Bridge Capital (LOAN) reduced its dividend by 10%.

GasLog Partners LP (GLOP) slashed its dividend by 77%.

BG Staffing (BGSF) slashed its dividend by 83%.

Investcorp Credit Management BDC (ICMB) cut its dividend by 40%.

Brixmor Property Group (BRX) suspended its dividend.

Exantas Capital Corp. (XAN) suspended its dividend.

Investcorp Credit Management BDC (ICMB) reduced its dividend by 28%.

Host Hotels & Resorts (HST) suspended its dividend.

KAR Auction Services (KAR) suspended its dividend.

Independence Realty Trust (IRT) cut its dividend by 33%.

Solar Senior Capital Ltd. (SUNS) reduced its dividend by 17%.

CVR Energy (CVI) cut its dividend by 50%.

BlackRock Capital Investment Corporation (BKCC) reduced its dividend by 29%.

Westpac Banking Corporation (WBK) suspended its dividend.

Extended Stay America (STAY) slashed its dividend by 96%.

Western Asset Mortgage Capital Corporation (WMC) suspended its dividend.

Wynn Resorts (WYNN) suspended its dividend.

FS KKR Capital Corp. (FSK) reduced its dividend by 21%.

GasLog Ltd. (GLOG) cut its dividend by 67%.

Marriott Vacations Worldwide Corporation (VAC) suspended its dividend.

Norbord (OSB) slashed its dividend by 75%.

Wendy's Company (WEN) cut its dividend by 50%.

Saratoga Investment Corp. (SAR) suspended its dividend.

Marathon Oil Corporation (MRO) suspended its dividend.

Sculptor Capital Management (SCU) suspended its dividend.

EPR Properties (EPR) suspended its dividend.

Evolution Petroleum Corporation (EPM) slashed its dividend by 75%.

Welltower (WELL) reduced its dividend by 30%.

National CineMedia (NCMI) cut its dividend by 63%.

SFL Corporation Ltd. (SFL) reduced its dividend by 29%.

Suncor Energy (SU) cut its dividend by 55%.

Walt Disney Company (DIS) suspended its dividend.

WestRock Company (WRK) cut its dividend by 57%.

Cheesecake Factory Incorporated (CAKE) suspended its dividend.

Jones Lang LaSalle Incorporated (JLL) suspended its dividend.

Carter's (CRI) suspended its dividend.

Viper Energy Partners LP (VNOM) slashed its dividend by 78%.

Capitala Finance Corp. (CPTA) suspended its dividend.

Great Ajax Corp. (AJX) cut its dividend by 45%.

Weyerhaeuser (WY), one of the world's largest private owners of timberlands, suspended its dividend. This will improve the REIT's financial flexibility as the COVID-19 pandemic reduces demand for wood products.

NuStar Energy L.P. (NS), one of the largest independent liquids terminal and pipeline operators in America, reduced its distribution by 33%.

High Country Bancorp (HCBC) cut its dividend by 50%.

PacWest Bancorp (PACW) cut its dividend by 58%.

Marcus Corporation (MCS) suspended its dividend.

Armada Hoffler Properties (AHH) suspended its dividend.

Molson Coors Beverage Company (TAP) suspended its dividend.

Banco Bilbao (BBVA) suspended its dividend.

Fidus Investment Corporation (FDUS) reduced its dividend by 23%.

Tenaris S.A. (TS) suspended its dividend.

Gaming and Leisure Properties (GLPI) lowered its dividend by 14% and began paying 80% of it in shares rather than cash. The REIT's gaming operators remain mostly closed due to the pandemic, though its major tenants have continued paying their rent.

MGM Resorts (MGM) slashed its dividend by 98%. With most of its hotels and casinos closed, MGM needed to preserve its liquidity.

American Airlines (AAL) suspended its dividend. The coronavirus-related plunge in travel demand, coupled with the high fixed costs of airlines, resulted in American burning through $70 million of cash per day.

Royal Dutch Shell plc (RDS.B) cut its dividend by 66%. Here's what we wrote about Shell's dividend in a March 11 note:

"Shell faces a tough decision if oil prices remain depressed for the foreseeable future. The company may have to decide between lowering its sacrosanct dividend or risking its credit rating by stretching its balance sheet even further while hoping for better market conditions sooner rather than later.

Shell's dividend has been a safe bet for more than 70 years, but this time could be different, depending on how conservative management wants to be given the uncertainty facing the energy market."

Western Digital (WDC) suspended its dividend. The manufacturer of data storage devices had a new CEO start earlier this year. He wanted to reinvest more in Western Digital's business to better position it for the cloud while also continue deleveraging the balance sheet.

SITE Centers (SITC) suspended its dividend. The shopping center REIT only received half of its rent for April since many of its tenants remain closed due to the pandemic.

Dunkin' Brands Group (DNKN) suspended its dividend.

Dine Brands Global (DIN) suspended its dividend.

Grupo Aeroportuario del Centro Norte, S.A.B. de C.V. (OMAB) suspended its dividend.

Methanex Corporation (MEOH) slashed its dividend by 90%.

Westwood Holdings Group (WHG) suspended its dividend.

New Mountain Finance Corporation (NMFC) reduced its dividend by 12%.

Fresh Del Monte Produce (FDP) cut its dividend by 50%.

Rollins (ROL) cut its dividend by 33%. Despite Rollins' pest control business being deemed essential during the coronavirus shutdown, management acted out of an abundance of caution, making this cut fairly discretionary and tough to get ahead of.

Nevertheless, Rollin's stock was up over 20% year-to-date while the S&P 500 was down over 10%. The balance sheet was in great shape, the business was generating strong cash flow, and the stock was off only 1% on the news. 

Ternium S.A. (TX) suspended its dividend.

Harley-Davidson (HOG) slashed its dividend by 95%.

Citi Trends (CTRN) suspended its dividend.

Coca-Cola European Partners plc (CCEP) suspended its dividend.

CNX Midstream Partners LP (CNXM) cut its dividend by 80%.

NGL Energy Partners LP (NGL) cut its dividend by 49%.

Global Partners LP (GLP) reduced its dividend by 25%.

Chico's FAS (CHS) suspended its dividend.

General Motors Company (GM) suspended its dividend.

Copa Holdings, S.A. (CPA) suspended its dividend.

CONSOL Coal Resources LP (CCR) suspended its dividend.

Southern Copper Corporation (SCCO) cut its dividend by 50%.

Holly Energy Partners (HEP) cut its dividend by 48%.

USD Partners LP (USDP) cut its dividend by 70%.

Alliance Data Systems Corporation (ADS) cut its dividend by 67%.

Invesco Ltd. (IVZ) cut its dividend by 50%.

Equinor ASA (EQNR) cut its dividend by 67%.

Terex Corporation (TEX) suspended its dividend.

SandRidge Permian Trust (PER) suspended its dividend.

Expedia Group (EXPE) suspended its dividend.

STMicroelectronics (STM), a global semiconductor manufacturer, cut its dividend by 30%. 

This was a tough cut to identify in advance because STM's payout ratio was below 20% throughout the pandemic and the firm had a strong balance sheet with more cash than debt (plus a BBB investment grade credit rating). 

STM shares had a dividend yield below 1%, so few investors owned the stock for income. STM finished 2020 with a total return of 39%, reflecting the company's underlying strength despite the headline dividend cut.

Retail Opportunity Investments Corp. (ROIC) suspended its dividend.

Black Stone Minerals (BSM) slashed its dividend by 73%.

Moelis & Company (MC) cut its dividend by 50%.

Inter Parfums (IPAR) suspended its dividend.

Natural Resource Partners L.P. (NRP) suspended its dividend.

Manning & Napier (MN) suspended its dividend.

Anworth Mortgage Asset Corporation (ANH) cut its dividend by 44%.

Landmark Infrastructure Partners LP (LMRK) cut its dividend by 46%.

Meredith Corporation (MDP) suspended its dividend.

Western Midstream Partners (WES) cut its dividend by 50%.

EnLink Midstream (ENLC) cut its dividend by 50%.

Hexcel Corporation (HXL) suspended its dividend.

Following the onset of the coronavirus pandemic, the Indian government mandated that banks could not pay out any dividends in order to preserve capital. As a result, HDFC Bank (HDB) was forced to suspended its dividend. With a low 0.8% dividend yield, however, HDB's dividend was not a significant contributor to the stock's return.

Schlumberger Limited (SLB) slashed its dividend by 75%.

Orange S.A. (ORAN) reduced its dividend by 29%.

Las Vegas Sands Corp. (LVS) suspended its dividend.

Dana Incorporated (DAN) suspended its dividend.

Columbia Sportswear Company (COLM) suspended its dividend.

MTS Systems Corporation (MTSC) suspended its dividend.

Cedar Fair (FUN) suspended its dividend.

Bed Bath & Beyond (BBBY) suspended its dividend.

Noble Energy (NBL) slashed its dividend by 83%.

Kohl's Corporation (KSS) suspended its dividend.

Banco Latinoamericano de Comercio Exterior (BLX) cut its dividend by 35%.

Estée Lauder (EL) suspended its dividend.

Vermilion Energy (VET) suspended its dividend.

Washington Prime Group (WPG) suspended its dividend.

Hallador Energy Company (HNRG) suspended its dividend.

Gladstone Capital Corporation (GLAD) reduced its dividend by 7%.

Covanta Holding Corporation (CVA) cut its dividend by 68%.

Anheuser-Busch InBev SA/NV (BUD) cut its dividend by 50%.

DICK'S Sporting Goods (DKS) suspended its dividend.

Southwest Airlines Co. (LUV) suspended its dividend.

Cinemark Holdings (CNK) suspended its dividend.

Harvest Capital Credit Corporation (HCAP) suspended its dividend.

Eagle Materials (EXP) suspended its dividend.

SkyWest (SKYW) suspended its dividend.

CorEnergy Infrastructure Trust (CORR) cut its dividend by 93%.

Genesis Energy (GEL) slashed its dividend by 73%.

Golub Capital BDC (GBDC) reduced its dividend by 12%.

Royal Caribbean (RCL), an owner and operator of cruiselines, suspended its dividend as cruises were canceled following the outbreak of the coronavirus.

SM Energy Company (SM) slashed its dividend by 80%.

Orchid Island Capital (ORC) cut its dividend by 31%.

Six Flags Entertainment Corporation (SIX) suspended its dividend.

AGNC Investment Corp. (AGNC) reduced its dividend by 25%.

Plains GP Holdings (PAGP) cut its dividend by 50%.

Plains All American Pipeline (PAA) cut its dividend by 50%.

Arconic (HWM) suspended its dividend.

CNH Industrial N.V. (CNHI) suspended its dividend.

CAE (CAE) suspended its dividend.

Blackbaud (BLKB) suspended its dividend.

R. R. Donnelley & Sons Company (RRD) suspended its dividend.

Diversified Royalty Corp. (BEVFF) reduced its dividend by 15%.

Pacific Coast Oil Trust (ROYT) suspended its dividend.

Cato Corporation (CATO) suspended its dividend.

Herman Miller (MLHR) suspended its dividend.

BP Prudhoe Bay Royalty Trust (BPT) suspended its dividend.

American Eagle Outfitters (AEO) suspended its dividend.

Enable Midstream Partners, LP (ENBL) cut its dividend by 50%.

Diversified Healthcare Trust (DHC), an owner long-term care facilities, slashed its dividend by 93% as the coronavirus placed even more pressure on the firm's weak balance sheet and high payout ratio.

CenterPoint Energy (CNP), a public utility company, cut its dividend by 52% due to the firm's reliance on its MLP, which reduced its dividend by 50% the same day, to fund growth projects.

Aegon N.V. (AEG) suspended its dividend.

Macquarie Infrastructure Corporation (MIC) suspended its dividend.

Quad/Graphics (QUAD) suspended its dividend.

Brinker International (EAT) suspended its dividend.

Cenovus Energy (CVE), an integrated oil and gas company based in Canada, suspended its dividend in response to an extreme decline in oil prices.

Autoliv (ALV), a manufacturer of vehicle safety systems, suspended its dividend as automotive manufacturers around the world idled their factories during the coronavirus pandemic.

Veolia Environnement S.A. (VEOEY) cut its dividend by 46%.

Murphy Oil Corporation (MUR) cut its dividend by 50%.

Lloyds Banking Group plc (LYG) suspended its dividend.

Daktronics (DAKT) suspended its dividend.

Barclays PLC (BCS) suspended its dividend.

Golar LNG Partners LP (GMLP) slashed its dividend by 95% as the MLP was forced to preserve capital to reduce debt.

Vail Resorts (MTN), an operator of mountain resorts and ski areas, suspended its dividend as properties were forced to close. Vail came into the crisis on reasonably strong footing, but the complete closure of its facilities for an unknown amount of time was an unprecedented challenge.

Helmerich & Payne (HP), an oil and gas producer, cut its dividend by 65%.

Global Net Lease (GNL) reduced its dividend by 25%.

PVH Corp. (PVH), a designer and retailer of brands such as Calvin Klein and Tommy Hilfiger, suspended its dividend as sales quickly dried up after retail outlets were closed around the world.

Gannett Co. (GCI), the owner of publications such as USA Today, suspended its dividend as advertising revenue was expected to decline significantly due to the global shutdown of businesses during the coronavirus pandemic.

Carnival (CCL), an owner and operator of cruiselines, suspended its dividend as cruises were canceled following the outbreak of the coronavirus.

HSBC Holdings plc (HSBC), a bank based in the U.K., suspended its dividend to preserve capital during the coronavirus pandemic.

WPP plc (WPP), the largest ad-agency holding company in the world, suspended its dividend as advertising budgets dried up during the coronavirus-related global shutdown.

Pennsylvania Real Estate Investment Trust (PEI), a retail REIT, slashed its dividend by 90%.

New Residential Investment Corp. (NRZ), a mortgage REIT, slashed its dividend by 90% as mortgage-backed securities declined significantly in value due to economic consequences of the coronavirus.

Ruth's Hospitality Group (RUTH) suspended its dividend.

ING Groep N.V. (ING), a Europe-based bank, suspended its dividend after the European Central Bank recommended that banks suspend dividend payments to free up capital for emergency lending.

Inter Pipeline Ltd. (IPPLF) cut its dividend by 72% as the sudden steep drop in global energy prices was expected to place pressure on pipeline revenue.

Service Properties Trust (SVC) slashed its dividend by 98%.

Alliance Resource Partners (ARLP) suspended its dividend.

La-Z-Boy Incorporated (LZB), a furniture maker and retailer, suspended its dividend as factories, distribution facilities, and retail outlets were forced to close.

Redwood Trust (RWT), a mortgage REIT, suspended its dividend delayed payment of its next dividend. Redwood's high use of leverage left little room to cover the dividend in th event of market volatility.

AG Mortgage Investment Trust (MITT), a mortgage REIT, suspended its dividend as the coronavirus pressured the value of the firm's investments.

L Brands (LB), an apparel retailer best known for its Victoria Secret stores, suspended its dividend as stores were forced to close nationwide. L Brands' financial flexibility was already in question coming into the coronavirus crisis.

EQT Corporation (EQT), a oil and gas producer, suspended its dividend as oil prices crashed. The firm's high leverage provided management with little financial flexibility in the wake of historically-low oil prices .

Granite Point Mortgage Trust (GPMT), a mortgage REIT, suspended its dividend as turmoil in financial markets put into question the performance of the firm's loans — Granite's high payout ratio and leverage left no alternative..

Signet Jewelers Limited (SIG), best known for its Kay Jeweler outlet stores, suspended its dividend as stores were closed nationwide.

Tapestry (TPR), a luxury clothing and accessory designer and retailer, suspended its dividend in the face of unprecedented uncertainty as stores were closed around the world.

Arlington Asset Investment Corp. (AI), a mortgage REIT, suspended its dividend to preserve liquidity as a result of volatile market conditions relating to the coronavirus pandemic.

Gap (GPS), an apparel retailer, suspended its dividend as stores were forced to closed around in the world in the wake of the coronavirus pandemic.

Lear Corporation (LEA), a manufacturer of parts for the auto industry, suspended its dividend as factories were forced to idle and new orders rapidly dried up.

Genesis Energy, L.P. (GEL) slashed its dividend by 72% as the highly-leveraged owner of midstream assets needed to preserve cash amidst record low oil prices .

BGC Partners (BGCP) cut its dividend by 93%.

MFA Financial (MFA), a mortgage REIT, suspended its dividend in order to preserve liquidity.

City Office REIT (CIO) cut its dividend by 36%.

Sabra Health Care REIT (SBRA) cut its dividend by 33%.

Noble Midstream Partners LP (NBLX) cut its dividend by 73% as the sudden collapse in oil prices was expected to pressure the MLP's cash flow.

Cracker Barrel Old Country Store (CBRL), a casual restaurant chain in the U.S., suspended its dividend as dining rooms closed to slow the spread of the coronavirus.

Summit Hotel Properties (INN), an upscale hotel REIT, suspended its dividend as properties were closed nationwide due to the coronavirus pandemic.

Alaska Air Group (ALK), a U.S.-based airline, suspended its dividend as demand for air travel plummeted in the wake of the coronavirus pandemic.

Nabors Industries Ltd. (NBR), a provider and operator of oil rigs, suspended its dividend due to a steep drop in demand as oil producers cut back production when oil prices tanked.

PennyMac Mortgage Investment Trust (PMT) cut its dividend by 47%.

Two Harbors Investment Corp. (TWO), a mortgage REIT, cut its dividend by 89% to preserve liquidity as the coronavirus pandemic rocked financial markets.

Steelcase (SCS), an office furniture designer and manufacturer, cut its dividend by 52% as demand was expected to plummet in light of the global shutdown of office spaces.

Invesco Mortgage Capital (IVR), a mortgage REIT, suspended its dividend as the firm was unable to meet margin calls during the turmoil in financial markets.

Texas Roadhouse (TXRH), a casual restaurant chain in the U.S., suspended its dividend to preserve cash as dining rooms were forced to close in response to the spread of the coronavirus.

SYNNEX Corporation (SNX), a distributor of technology services and products, suspended its dividend due to the highly uncertain near-term outlook facing the business.

Whitestone REIT (WSR), an owner of retail centers, cut its dividend by 63% as the already-struggling REIT didn't have the financial flexibility to withstand the looming pressure on rent revenue from coronavirus-related shutdowns.

Buckle (BKE) suspended its dividend.

Nordstrom (JWN), a upscale fashion retailer, suspended its dividend to preserve cash as stores were forced almost overnight to close nationwide.

New York Mortgage Trust (NYMT), a mortgage REIT, suspended its dividend as the firm was unable to meet margin calls during the turmoil in financial markets.

Orion Engineered Carbons S.A. (OEC) suspended its dividend.

Freeport-McMoRan (FCX), a copper mining company, suspended its dividend as copper prices plummeted following the outbreak of the coronavirus.

DCP Midstream, LP (DCP) cut its dividend by 50% as the firm's already-high payout ratio and leverage were set to be under pressure due to the collapse in oil prices.

Aptiv PLC (APTV), a designer and manufacturer of vehicle components, suspended its dividend as car meakers were forced to idle factories. Despite a low payout ratio and sold balance sheet, management thought it was prudent to preserve cash amidst so much uncertainty.

Banco Santander, S.A. (SAN), a bank in Spain, suspended its dividend in order to preserve capital and boost lending to the community in the wake of the coronavirus crisis.

Darden Restaurants (DRI), the operator of Olive Garden and LongHorn Steakhouses in the U.S. and Canada, suspended its dividend to preserve cash amidst unprecedented uncertainty as to when its restaurants would reopen and how quickly customers would return.

Bloomin' Brands (BLMN) suspended its dividend as the operator of Outback Steakhouse and several other restaurants was forced to close dining rooms due to the coronavirus outbreak.

Apple Hospitality (APLE), a REIT whose portfolio consists of Marriott and Hilton-branded hotels, suspended its monthly distribution to preserve cash as the coronavirus outbreak created an unprecedented shock on demand in for travel and accomodations.

Macy's (M) suspended its dividend. Stores were closed nationwide due to the coronavirus outbreak, but the retailer's elevated debt levels, high payout ratio, and poor long-term outlook saw the firm's Dividend Safety Score rated Unsafe since September 2019.

Ashford Hospitality Trust (AHT), an upscale hotel REIT, suspended its dividend as demand for accommodation plummeted following the outbreak of the coronavirus and resulting guidelines issued by the government.

Boeing (BA) suspended its dividend. The airplane maker was in dire need of cash due to the grounding of the 737-MAX and as it became clear Boeing's customers (airlines) would be facing unprecedented financial strain due to the coronavirus outbreak. Boeing was downgraded to Unsafe on March 11, and shares had fallen almost 50% since.

Delta Air Lines (DAL) suspended its dividend as demand for air travel dropped at an unprecedented pace. We had previously downgraded Delta to Borderline Safe on March 10 as it became clear much travel would cease due to the coronavirus outbreak. Shares have fallen almost 50% since.

Marriott International (MAR) suspended its dividend as demand plummeted amidst the coronavirus outbreak.

Ford (F) suspended its dividend to preserve cash and provide financial flexibility as factories shut down and the outlook for demand materially worsened following the outbreak of the coronavirus. Ford had never scored above Borderline Safe for Dividend Safety due to the firm's elevated payout ratio, less conservative balance sheet, and weak profitability.

Hersha Hospitality (HT), a REIT that invests in upscale hotels, suspended its dividend "due to the recent lodging demand shocks stemming from the COVID-19 outbreak".

Allegiant Travel Company (ALGT), a leisure travel company, suspended its dividend as travel demand dropped suddenly following the coronavirus outbreak. The firm's debt levels and payout ratio were in healthy shape prior to the sudden developments, making it hard to have gotten far ahead of this cut.

Target Resources (TRGP), an operator of midstream assets in the oil industry, slashed its dividend by 89% to free up cash to reduce debt as oil prices plunged. The company had never scored above Very Unsafe for Dividend Safety due to the high payout ratio and debt levels maintained by the firm.

DiamondRock Hospitality (DRH), a hotel REIT, suspended its dividend due to the uncertainty surrounding the impact of the coronavirus on business.

Guess? postponed the declaration of its dividend as the apparel retailer was facing temporary closures worldwide. The firm's weaker balance sheet and high payout ratio left little room for any surprises, let alone the unprecedented shock in demand from the coronavirus outbreak.

RLJ Lodging Trust, a hotel REIT, cut its dividend by 97%. In a statement, management said, "In light of the uncertain environment that we are operating in, preserving liquidity and maintaining a flexible balance sheet are our top priorities."

Chatham Lodging Trust (CLDT), a lodging real estate investment trust, suspended its dividend to preserve cash amidst unprecedented uncertainty as to when the company could reopen its hotels following the outbreak of the coronavirus.

Designer Brands (DBI), an apparel retailer in the U.S. and Canada, slashed its dividend by 60% "in an abundance of caution and to preserve our financial flexibility during this difficult time". Stores had closed due to the outbreak of the coronavirus, and the firm's high payout ratio and poor balance sheet left it with little capacity to take a major hit and still fund the dividend.

Sotherly Hotels (SOHO), an upscale hotel REIT, suspended its dividend as demand plummeted due to the spread of the coronavirus.

Ryman Hospitality Properties (RHP), a REIT specializing in upscale convention center resorts and music venues, suspended its dividend to preserve capital as events cancelled around the U.S. following the outbreak of the coronavirus.

Crescent Point Energy (CPG) reduced its dividend by 75% in response to the drastic decline in oil prices. The oil producer's small size and relatively high leverage left the firm with little choice but to preserve cash and reduce capital spending in order to keep the lights on.

Pebblebrook Hotel Trust (PEB) suspended its dividend "due to unprecedented uncertainty from the rapidly evolving impact of COVID-19 on the travel industry and hotel demand". Pebblerook had long scored on the lower end of Borderline Safe for Dividend Safety due the hotel industry's cyclicality as well as the firm's weaker balance sheet and relatively small size.

Macerich Company (MAC), a mall REIT, cut its dividend by 87% in anticipating of a material financial hit due to the closing of malls around the U.S. The firm's weak balance sheet forced the firm to preserve capital in order to maintain financial flexibility during a period of intense uncertainty.

Vermillion Energy (VET), an oil and natural gas producer, slashed its dividend by 83%, the  firm's second cut to its monthly dividend in two weeks. Vermillion had previously paid uninterrupted dividends since 2001, but a weak balance sheet made the firm unable to cope with the "pronounced decline in global commodity prices".

Core Laboratories, a provider of equipment and services to the oil and gas industry, cut its dividend by 96% as oil producers cut spending in response to a plunge in oil prices. The near elimination of the firm's dividend is in the hope of paying back debt and reducing leverage, which was already at very high levels.

Park Hotels & Resorts (PK), an operator of luxury accommodations in the U.S., suspended its dividend as the hotel industry faced an unprecedented shock in demand due to the coronavirus outbreak.

Ark Restaurants (ARKR) deferred payment of its next dividend. The small restaurant operator needed to preserve cash flow in light of "the unprecedented circumstances and rapidly changing situation with respect to the coronavirus disease."

Arc Resources (AETUF), a Canadian oil and gas producer, axed its dividend by 60%. The firm needed to protect its balance sheet following the plunge in oil prices.

Apache (APA) cut its dividend by 90%. The oil and gas exploration and production company needed to preserve capital after Saudi Arabia initiated an oil-price war. Apache's 19-year streak of uninterrupted dividends came to an end.

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. (PAC) suspended its dividend.

MIND C.T.I. (MNDO), an Israeli-based billing and customer care software solutions provider, reduced its annual dividend by 8%. Revenue and profit had been on the decline as contracts were lost with several major customers and competition stiffened in the telecom market.

Occidental Petroleum (OXY) slashed its dividend by 79%. Following a single-day decline of more than 20% in the price of oil, the highly leveraged oil and gas producer needed to preserve capital and lower its cash flow breakeven point as it prepared for a significantly weaker commodity price environment going forward.

We published a note on February 28, 2020, summarizing Oxy's dividend risk:

"The bottom line is that debt reduction needs to be a top priority, and organic deleveraging won't come easy with the dividend consuming so much of Oxy's free cash flow. An argument could be made that the most prudent course of action would be to cut the dividend to improve the firm's financial flexibility...

Oxy is basically a leveraged bet on the price of oil. If oil rallies higher and supports the firm's deleveraging and production growth goals, it wouldn't be surprising to see the stock double and its dividend continue growing.

But if the price of oil weakens further and asset sales become more difficult to execute, then Oxy's dividend could eventually find itself on the chopping block to free up cash for faster deleveraging...

Conservative investors may want to watch from the sidelines until management has made more progress paying down debt, improving Oxy's ability to handle periods of commodity price weakness as it has historically."

Vermilion Energy (VET) lowered its dividend by 50%. The oil and natural gas producer's profits remained under pressure due to weak commodity prices. With the dividend unlikely to be covered by free cash flow in this environment, plus the balance sheet's rising leverage, Vermilion's dividend cut will give the firm more flexibility. Shares fell 18% on the news.

Coty suspended its dividend. The seller of branded perfumes, skin care, color cosmetics, and other beauty products was saddled with debt and under pressure as the pandemic caused a major sales decline.

EQM Midstream Partners (EQM) effectively cut its distribution by 68% after agreeing to merge with its general partner in an all-stock transaction. The midstream MLP also renegotiated its natural gas gathering contracts with its upstream partner EQT, which needed fee relief in light of the challenging gas price environment. The combined company's leverage and distribution coverage ratio would be under pressure, so cutting the distribution improves the firm's financial flexibility.

AMC Entertainment (AMC) cut its dividend by 85%. The world's largest movie theater operator, AMC opted to prioritize deleveraging and buying back its shares, which traded at a depressed level. Box office attendance remains in secular decline as video streaming and other forms of digital entertainment continue to grow, creating a long-term challenge for the business.

Seadrill Partners LLC (SDLPF) suspended its dividend.

Washington Prime Group (WPG) axed its dividend by 50%. Many of the shopping center REIT's tenants faced disruption from e-commerce, pressuring Washington Prime's earnings. The REIT's dividend was no longer covered by cash flow, and its balance sheet was saddled with debt. Cutting the dividend provides Washington Prime with a more sustainable payout ratio and flexibility to fund redevelopment projects.

Six Flags (SIX) slashed its dividend by 70%. The theme park operator was challenged by rising costs and soft growth, creating a need to invest more in its operations to improve the experience for its guests. With free cash flow failing to cover the dividend and its balance sheet saddled with debt, Six Flags needed to cut its payout to improve its financial flexibility. Shares plunged nearly 20% on the news.

JMP Group LLC (JMP) suspended its dividend.

Apollo Commercial Real Estate (ARI) lowered its dividend by 13%. The mortgage REIT was hurt by spread compression and a decline in interest rates, which reduced the interest income it could earn in commercial loan markets. Apollo's new dividend is better aligned with its lower earnings level going forward.

U.S. Silica (SLCA) cut its dividend by 68%. Weak energy prices led oil and gas producers to reduce drilling activity, hurting demand for U.S. Silica's frac sand. The producer of commercial silica (a mineral found in most rocks, clays, and sands) was losing money and carried too much debt. Cutting the dividend allows the firm to invest more in its non-energy businesses and provides greater flexibility to reduce debt.

Manhattan Bridge Capital (LOAN) reduced its dividend by 8%. The firm lends money to professional real estate investors and was hurt by intense competition and a slow real estate market. These factors forced Manhattan to reduce its average interest rate, pressuring earnings. With its payout ratio above 100%, right-sizing the dividend was a prudent course of action.

Spirit AeroSystems (SPR) cut its dividend by 92%. In December, we downgraded Spirit's Dividend Safety Score to Borderline Safe as it appeared more likely that Boeing, which accounts for 80% of the component supplier's revenue, would need to further reduce or even suspend production of its grounded 737 MAX aircraft. This would pressure Spirit's cash flow.

Although Spirit's payout ratio was only about 10% and the firm had an investment-grade credit rating, management opted to reduce the dividend "in an abundance of caution" to preserve liquidity until Boeing's production rates improve. At that time, the board will reevaluate the dividend.

With the stock's dividend yield below 1%, few investors likely owned Spirit for income. Shares of Spirit were also largely unchanged on the news, minimizing the damage from this event.

GasLog Partners LP (GLOP) cut its distribution by 78%, sending its stock tumbling nearly 50% on the news. The owner and operator of liquefied natural gas carriers surprised many investors with this announcement since the firm maintained a reasonable distribution coverage ratio near 1.2x and had highlighted the "prudent coverage" of its payout in past quarters. 

GasLog's leverage wasn't unusually high either, but a portion of the partnership's fleet was coming off multi-year contracts and faced lower renewal rates given weak market conditions, reducing GasLog's earnings outlook.

Coupled with the stock's weak valuation, which made funding new vessel acquisitions challenging, GasLog decided to cut its distribution to focus more on strengthening its balance sheet.

Westwood Holdings Group (WHG) slashed its dividend by 40%. The asset management industry continues facing disruption from low-cost index funds, and investment manager Westwood is no exception. The firm's actively-managed equity strategies experienced significant asset outflows which drove a 30% revenue decline in 2019. Cutting the dividend better aligns the payout with Westwood's lower earnings.

Black Stone Minerals, L.P. (BSM) lowered its distribution by 19%. The owner of oil and natural gas mineral interests expected falling commodity prices to reduce overall drilling activity in 2020. Although the distribution was covered by the firm's distributable cash flow and its leverage was reasonable, lowering the payout provides Black Stone Minerals with additional cash flow it can use to further improve its balance sheet, repurchase shares, and make acquisitions.

Summit Midstream Partners, LP (SMLP) cut its distribution by 57%, its second cut in less than a year. The operator of midstream energy infrastructure assets maintained a reasonable payout ratio well below 100%, but it continued carrying too much debt. Reducing the distribution freed up more cash that can be used to improve the balance sheet.

Martin Midstream Partners (MMLP) slashed its distribution by 75%. The midstream services provider desired to improve its access to capital by strengthening its distribution coverage ratio and further reducing its leverage. Cutting the distribution helps accomplish both goals, but this action sent MMLP shares falling 20%.

Alliance Resource Partners, L.P. (ARLP) cut its distribution by 26%. The coal MLP remained profitable but faced challenging end market conditions, driven by a collapse in international coal prices, low natural gas prices, and the world's continued transition to cleaner energy. Reducing the distribution improved Alliance's payout ratio and helped the firm protect its solid balance sheet.

EnLink Midstream (ENLC) cut its distribution by 34%. The struggling midstream energy service provider was operating with a high payout ratio and less-than-stellar debt levels. With the firm's share price in the tank, management decided to reduce the distribution and self-fund capital expenditures instead of relying on issuing equity to raise capital.

Range Resources (RRC) suspended its dividend. The shale gas producer was under pressure from weak natural gas prices. Although its dividend was relatively small (the stock's dividend yield was less than 2%), the firm needed to preserve cash to protect its balance sheet.

Core Laboratories (CLB) cut its dividend by 55%, ending its 10-plus year streak of uninterrupted payouts just two months after management said that "Core has no plans to cut our dividend."

The provider of analytical, diagnostic, and field services to the oil and gas industry was challenged by a decline in U.S. onshore activity and sluggish client activity levels in international and offshore crude oil markets. Although the business was still profitable and had reasonable leverage, management opted to cut the dividend to preserve Core Lab's solid balance sheet. Shares fell 20% on the news.

U.S. Steel (X) slashed its dividend by 80%. One of the oldest and highest-cost steel manufacturers in America, U.S. Steel faced increased financial pressure from falling steel prices, a large acquisition announced in October 2019, and aggressive investment plans to improve the performance of its mills. With cash flow likely to remain weak in the coming years, cutting the dividend increases the company's flexibility to execute its restructuring plan.

Anworth Mortgage (ANH) cut its dividend by 10%. The mortgage REIT generates income primarily based on the difference between the yield on its long-term mortgage assets and the cost of its short-term borrowings. Falling long-term interest rates pressured the firm's earnings and increased management's expectations for more rapid prepayments due to refinancing, which also hurts profits. With a payout ratio above 100%, Anworth needed to reduce its dividend to better align it with the firm's earnings.

Kewaunee Scientific (KEQU) suspended its dividend. The lab equipment and technical products maker had paid uninterrupted dividends for more than 20 years. While Kewaunee was growing its revenue and maintained a healthy balance sheet, the firm faced a very competitive marketplace and encountered operational inefficiencies which depressed its profitability. Management initiated a restructuring plan and decided to eliminate the dividend in order to invest more in improving the business. Shares fell more than 25% on the news.

Kewaunee Scientific Corporation (KEQU) suspended its dividend.

Salem Media (SALM) cut its dividend by 62%. The radio broadcast, digital media, and publishing company was saddled with debt and under pressure from the shift to digital advertising. Reducing the dividend provides Salem with much needed cash to help improve its balance sheet as the firm's profitability erodes.

Garrison Capital (GARS) lowered its dividend by 35%. The business development company's profit was hurt by lower interest rates and an underperforming debt investment, keeping its payout ratio above 100%. Shares fell more than 10% on the news.

Tupperware (TUP) suspended its dividend. The maker of food storage containers, cookware, and beauty products needed to preserve cash to strengthen its balance sheet and gain more flexibility for its turnaround efforts. Tupperware's sales and cash flow remained under pressure as consumers opted for cheaper products and e-commerce challenged its direct-sales model. 

Nielsen (NLSN) cut its dividend by 83%. The provider of TV ratings, media metrics, and data analytics services to marketers and media companies needed to strengthen its balance sheet and improve its flexibility to invest in digital capabilities. The rise of streaming video and advertisers' desire for more granular data on their audiences put pressure on the business.

Medical Facilities (MFCSF) slashed its dividend by 75%. The owner and operator of surgical facilities was challenged by unfavorable payor and case mix changes, which pushed its payout ratio well above 100%. Shares fell more than 25% on the news.

Blue Capital Reinsurance Holdings Ltd. (BCRHF) suspended its dividend.

Vector Group (VGR) slashed its dividend by 50%, ending its 20-year dividend growth streak and sending its shares falling more than 10%. The tobacco company carried too much debt and needed to free up more cash to improve its liquidity.

Westpac (WBK) reduced its semi-annual dividend by 15%. Australia's oldest bank was under pressure from lower interest rates, which drove a double-digit decline in earnings. Cutting its dividend will help Westpac bring its payout ratio to a more sustainable range while also increasing its capital buffers and providing the lender with flexibility in case regulators alter capital rules in the future. 

Jernigan Capital (JCAP) cut its dividend by 34%. The mortgage REIT provides capital to operators of self-storage facilities and reduced its payout as part of its decision to internalize its management team and convert to an equity REIT that owns storage units. The right-sized dividend is better aligned with the firm's ongoing cash flow generation.

Quad/Graphics (QUAD) cut its dividend by 50%. The provider of commercial printing and marketing services desired additional financial flexibility to invest in growth opportunities and protect its balance sheet as it combatted ongoing print industry volume and pricing pressures. Shares fell more than 50% on the news.

Nokia (NOK) suspended its dividend, sending its shares falling more than 20% on the news. The telecom equipment maker felt pressure to invest more in 5G products and experienced profitability challenges in China. Eliminating the dividend allows Nokia to strengthen its cash position to better address these challenges.

Fluor (FLR) lowered its dividend by 52%. Following a strategic review, the engineering and construction firm opted to divest businesses representing nearly 20% of its revenue to improve its long-term profitability. Reducing the dividend better aligns Fluor's payout with its ongoing cash flow generation and improves the company's financial flexibility as it evolves.

Dynagas LNG Partners LP (DLNG) suspended its dividend.

Anworth Mortgage (ANH) reduced its dividend by 10%. The mortgage REIT generates income primarily based on the difference between the yield on its long-term mortgage assets and the cost of its short-term borrowings. The flattening yield curve pressured the firm's earnings and kept its payout ratio above 100%, leading to the dividend reduction.

Friedman Industries (FRD) cut its dividend by 50%. The steel processor and pipe manufacturer was challenged by the continued decline in steel prices and softer demand, which pressured the firm's profitability.

Tailored Brands (TLRD) suspended its dividend. The apparel retailer operates stores under brands such as Men’s Wearhouse and Jos. A. Banks. Tailored Brands had a reasonable payout ratio below 40%, but continued sales declines and a weak stock price led management to cut the dividend, freeing up more cash flow for debt repayment and share repurchases. Shares slumped 30% on the news.

Tailored Brands (TLRD) suspended its dividend.

Rayonier Advanced Materials (RYAM) suspended its dividend. The maker of performance fibers, lumber, and pulp was challenged by weak commodity markets. Losing money and struggling with a high debt burden, Rayonier needed to preserve cash.

AG Mortgage Investment Trust (MITT) reduced its dividend by 10%. The flattening yield curve pressured the mortgage REIT's earnings, pushing its payout ratio to an unsustainable level.

Cherry Hill (CHMI) lowered its dividend by 18%. The mortgage REIT saw prepayments accelerate due to falling mortgage rates, hurting the value of its mortgage servicing rights portfolio. With its payout ratio projected to exceed 100% in the year ahead, the firm needed to cut its dividend.

Golar LNG Limited (GLNG) suspended its dividend.

Just Energy (JE) suspended its dividend. The independent energy retailer was losing money and saddled with debt. Suspending its dividend will help the firm preserve liquidity. Shares fell about 40% on the news.

Just Energy Group (JE) suspended its dividend.

Medley Capital Corporation (MCC) suspended its dividend. The business development company contended with poor investment performance, which had pushed its payout ratio well above 100%, and faced uncertainty regarding a controversial merger which many shareholders opposed.

Kingstone Companies (KINS), a property and casualty insurance company, cut its dividend by 53%. While the dividend was well covered by the firm's investment income, management chose to reduce the dividend to retain more cash and strengthen the balance sheet. The company had been facing weakening profitability with its products, especially with commercial liability insurance.

Himax Technologies (HIMX) suspended its dividend.

KAR Auction Services (KAR) reduced its dividend by 46% following the spin-off of its salvage car auction business. The spin-off company, Insurance Auto Auctions (IAA), has not announced a dividend, leaving dividend investors with an apparent reduction in their income.

Portman Ridge Finance (PTMN) cut its dividend by 40%. The business development company desired to more closely align dividends with net investment income being generated by the fund, resulting in a more sustainable payout ratio. 

Dynex Capital (DX) lowered its dividend by 17%. The mortgage REIT's earnings were pressured by the inverted yield curve that resulted in higher financing costs and lower mortgage rates driving higher prepayment rates.

BlackRock Capital (BKCC) lowered its dividend by 22%. Underperforming investments weighed on the business development company's earnings, pushing its payout ratio above 100%. Cutting the dividend better aligns the payout with the current earnings power of the firm.

Seadrill Partners (SDLP) slashed its dividend by 90%. The highly leveraged provider of offshore contract drilling services needed to preserve liquidity ahead of upcoming debt maturities.

RPC (RES) suspended its dividend.

Cal-Maine Foods (CALM) suspended its dividend.

Deutsche Bank (DB) opted to radically restructure its business and suspended its dividend as part of management's new capital allocation plan, which included laying off about 20% of its workforce and exiting several business lines. The bank's forward payout ratio sat below 20% and its dividend yield was less than 1%, so the stock wasn't owned by many investors for the dividend.

Arlington Asset Investment Corp (AI) slashed its dividend by 40%. The highly leveraged mortgage REIT was under pressure as the flattening yield curve pushed down its earnings and was causing its payout ratio to rise to an unsustainable level.

ARMOUR Residential REIT (ARR) reduced its dividend by 11%. The residential mortgage REIT faced headwinds from falling long-term interest rates, which increase mortgage prepayment risk and reduce the profit spread the business earns.

Two Harbors Investment (TWO) reduced its dividend by 15%. Lower interest rates led to accelerated mortgage prepayment speeds, pressuring the residential mortgage REIT's earnings and sending its payout ratio above 100%.

Ashford Hospitality Trust (AHT) slashed its dividend by 50%. Despite maintaining a payout ratio near 50%, the hotel REIT had too much debt and needed to preserve more capital to strengthen its balance sheet. Shares plunged 15% on the news.

Anworth Mortgage (ANH) cut its dividend by 15%. The mortgage REIT generates income primarily based on the difference between the yield on its long-term mortgage assets and the cost of its short-term borrowings. The flattening yield curve pressured the firm's earnings and kept its payout ratio above 100%, leading to the dividend reduction.

Ellington Residential Mortgage REIT (EARN) reduced its dividend by 18%. The flattening yield curve reduced the firm's portfolio value, net interest margin, and core earnings. With a payout ratio above 100% and use of meaningful leverage, cutting its dividend was necessary.

GameStop (GME) eliminated its dividend, sending its shares plunging 30%. The troubled video game retailer experienced steep sales declines as online gaming disrupted its business. With a payout ratio approaching 100% and a highly leveraged balance sheet, GameStop needed to improve its financial flexibility.

Daktronics (DAKT) cut its dividend by 29%. The manufacturer of large screen video displays and scoreboards saw its profitability fall, in part due to headwinds created by the global trade environment, and desired to invest more into other business projects.

Ensco Rowan (ESV) suspended its dividend.

Medley Management (MDLY) suspended its dividend.

Vodafone (VOD) reduced its dividend by 40%. In October 2018, we published a note warning that the telecom firm's payout could find itself on shaky ground in the year ahead. Here's a relevant excerpt:

"With Vodafone's dividend amounting to around $4.5 billion per year (compared to more than $35 billion of debt), reducing the payout is certainly a lever management could pull to accelerate deleveraging and create more breathing room for big-ticket investments the firm's network requires...

With the dividend consuming the bulk of Vodafone's free cash flow, plus rising leverage from the Liberty Global deal, the capital-intensive nature of its businesses, and very competitive telecom markets in Europe, there is little room for error...

As conservative income investors, we prefer to stick with financially stronger businesses that score closer to 60 or higher for Dividend Safety...The next year could be volatile for Vodafone as investors learn more about the company's health and ability to remain committed to its dividend."

Addressing the dividend cut, management called out weaker than expected revenue trends due to "a more intense environment." While the dividend was technically still covered by free cash flow, reducing the payout allows Vodafone to proactively prioritize faster deleveraging and improve its financial headroom as it invests for the future.

Ciner Resources LP (CINR) cut its distribution by 40%. Despite recording double-digit cash flow growth and maintaining a distribution coverage ratio above 1.0, the commodity chemical producer wanted to redirect more capital to its growth projects. CINR units fell 15% on the news.

Unique Fabricating (UFAB) suspended its dividend.

Foresight Energy LP (FELPQ) suspended its dividend.

J2 Global (JCOM), an internet services provider, suspended its dividend in favor of preserving cash to more aggressively grow its business through acquisitions. However, JCOM's stock yielded only 2%, suggesting few investors owned JCOM for its payout. In fact, JCOM's stock price actually rose following the announcement and is currently near an all-time high.

With a healthy 25% payout ratio, low debt levels, solid cash flow, and EPS growth of 15% in the most recent quarter, JCOM's dividend cut would've been difficult to predict. Management certainly could've continued to pay the dividend but felt the company (and shareholders) would benefit more from quick expansion into new business lines outside the company's legacy fax and voice products. Here's what management said:

"Our portfolio of businesses - and the leadership managing it - has never been stronger or deeper,” said Vivek Shah, CEO of j2 Global. “It’s reflected in our first quarter results, our improved outlook for the remainder of the year and the breadth of promising investment opportunities in front of us. It’s why we are confident that by suspending our dividend, we can prudently direct the increasing cash flow to opportunities within our businesses to create greater shareholder returns over the near, medium and long term."

Discretionary cuts like JCOM's are extremely rare. Nevertheless, we're constantly improving our scoring system and will continue to look for ways to better assess dividend risk profiles.

Annaly Capital Management (NLY), a mortgage REIT, cut its dividend by 17%. The firm had been the only company in its industry not to have reduced its payout over the last five years, but a flattening yield curve and compressed spreads pushed its payout ratio above 100%. 

Management did not want to increase Annaly's leverage or risk profile just to maintain the dividend, so the payout was reduced to a more sustainable level for the long term. Generally speaking, mortgage REITs depend on many factors outside of their control, making their dividends riskier.

Meridian Bioscience (VIVO) suspended its dividend. Despite paying dividends for more than 20 years and sporting a payout ratio below 65%, the supplier of healthcare diagnostic test kits changed its capital allocation philosophy to increase growth investments and help fund an acquisition. VIVO shares fell 14%.

JMP Group LLC (JMP) slashed its dividend by 56% after the investment banking and asset management firm converted from a partnership to a C corporation for tax purposes. Management lowered the company's target payout ratio from 95% to 50% in order to retain more cash flow for growth investments.

Consolidated Communications (CNSL) suspended its dividend, sending its shares tumbling more than 20%. The provider of internet and phone services was losing money and had too much debt. Cutting the dividend freed up more cash for deleveraging efforts.

Martin Midstream Partners (MMLP) chopped its distribution in half. The midstream services provider was challenged by volatile commodity prices which pushed its payout ratio and debt metrics to dangerous levels. Management wanted to improve the distribution's coverage and the firm's financial flexibility. MMLP shares closed 21% lower on the news.

RPC (RES), a provider of oilfield services and equipment, cut its dividend by 50%. Management cited uncertainty in the oilfield market, which was expected to pressure RPC's earnings in the year ahead. Shares fell 18% on the news.

Teekay Corporation (TK) suspended its dividend.

AGNC Investment Corp. (AGNC) lowered its monthly dividend by 11%. The mortgage REIT's net interest income was hurt by the flattening yield curve, leading management to reduce the dividend to keep AGNC's payout ratio at a more sustainable level.

Banc of California (BANC) cut its dividend by 54%. Despite maintaining an earnings payout ratio near 60%, the bank's new CEO opted to reduce the dividend in order preserve more capital that could be redeployed into "more useful and core aspects of the business in the near term." 

Guess (GES) cut its dividend by 50%. Although the apparel retailer had paid uninterrupted dividends for more than a decade, management opted to reduce the payout in order direct more capital towards share repurchases. Guess's balance sheet was also stretched, and its high payout ratio limited the firm's financial flexibility.

Blueknight Energy Partners, L.P. (BKEP) cut its distribution in half. The provider of midstream energy services had a payout ratio below 50%, but management desired to strengthen the firm's balance sheet.

Senior Housing Properties Trust (SNH) announced plans to reduce its annual payout to $0.55 to $0.65 per share, or a 62% dividend cut at the midpoint of guidance. The senior housing REIT needed to restructure a deal with a large struggling tenant, pressuring its cash flow. Combined with an elevated payout ratio and high debt load, a dividend cut was necessary. Shares fell nearly 20%.

Medley Management (MDLY) cut its dividend by 85%. The struggling investment manager was challenged by persistent asset outflows, which resulted in lower fee income and an unsustainable payout ratio.

Guangshen Railway (GSH), a passenger and freight train operator in China, reduced its annual dividend by 25%. Although the state-controlled company's payout ratio stood below 60% and the firm had no debt, management sought an even lower payout ratio as the firm's investment spending increased.

CBL Properties (CBL) suspended its dividend for two quarters. The mall REIT faced a class action lawsuit from 2016 related to claims it overcharged tenants for electricity. With a costly settlement drawing closer and the firm's balance sheet remaining weak, CBL needed to preserve capital. Shares fell 25% on the news.

Uniti Group (UNIT), a wireless infrastructure REIT, chopped its dividend by 92%. The firm's largest customer, Windstream, declared bankruptcy, creating uncertainty regarding its ability to honor its lease contract with Uniti. 

The REIT's lenders amended their credit agreement with the company as well, including a restriction on Uniti's ability to pay dividends. Combined with the cash flow uncertainty due to Windstream's financial distress, Uniti's dividend cut will help preserve cash as management addresses these challenges.

Friedman Industries (FRD) reduced its dividend by 33%. The steel processor and pipe manufacturer operates a cyclical business and expected margins to contract. As a micro-cap stock, Friedman's capital allocation decisions can be more dynamic, too.

Blue Capital (BCRH), a reinsurance provider in the property catastrophe market, slashed its dividend by 50%. Several hurricanes and wildfires caused the firm to lose money, resulting in a steep dividend cut.

THL Credit (TCRD), a business development company, cut its dividend by 22%. The firm's payout ratio exceeded 100% as management's actions to reduce risk in THL's portfolio resulted in lower investment income.

Dean Foods (DF) suspended its dividend. The milk processor and dairy products manufacturer was losing money and had a dangerously high debt load. Suspending its dividend provided the company with more financial flexibility as it continued its turnaround plan. Shares of Dean Foods dropped 14% on the news.

Dean Foods Company (DFODQ) suspended its dividend.

Despite paying uninterrupted dividends for more than 20 consecutive years, Protective Insurance Corporation (PTVCA) cut its dividend by 64%. The property and casualty insurer incurred steep underwriting losses in its commercial auto line and desired to preserve capital in order to protect its investment grade credit rating.

Summit Midstream Partners, LP (SMLP) slashed its distribution in half, sending its shares plunging as much as 20% on the news. The operator of midstream energy infrastructure assets needed to improve its ability to fund growth projects and maintain a healthier credit profile as it simplified its business structure.

Maiden Holdings, Ltd. (MHLD) suspended its dividend.

Seritage Growth Properties (SRG), a retail REIT with substantial exposure to Sears, suspended its dividend. The move frees up cash to help management fund redevelopment efforts as Seritage works to continue reducing its exposure to Sears and improve its profitability.

County Bancorp (ICBK), a micro-cap bank stock operating in Wisconsin, lowered its dividend by 29%. The firm had a payout ratio below 15% and reported solid growth in deposits, book value per share, and loans serviced. 

Small companies can have more dynamic capital allocation policies regardless of their current business fundamentals, so we do our best to treat them more conservatively.

Kraft Heinz (KHC) cut its dividend by 36%. In November 2018, four months before the reduction was announced, we published a note warning of a possible dividend cut. 

We wrote, "given the company's somewhat high payout ratio and large amount of debt, if Kraft Heinz can't start delivering on its turnaround plan quickly (in 2019), then the risk of its frozen dividend being cut could increase. While the stock's current yield is certainly generous, conservative income investors may prefer to look at other companies with safer dividends, superior growth potential, and less hair from a heavy debt load and struggling turnaround effort."

The packaged food giant was struggling to achieve profitable growth due to changing consumer tastes and years of underinvestment in its brands. Management, led by private equity firm 3G Capital, desired to cut the dividend to accelerate the firm's pace of deleveraging in light of increasingly attractive opportunities they saw to make acquisitions and consolidate the industry. 

Given 3G Capital's ongoing struggles to create value from the 2015 Kraft-Heinz merger, investors were less than thrilled to hear management's excitement about making more large acquisitions. With investors losing confidence in Kraft Heinz's brands and 3G Capital's reputation as a savvy dealmaker, shares of KHC fell more than 25% on the news.

Less than four months after stunning investors with its first dividend cut in October 2018, Owens & Minor (OMI) slashed its dividend by 97%, sending its shares falling as much as 20%. The medical supplies distributor was saddled with debt from recent acquisitions and remained under pressure as its healthcare customers continued looking for ways to cut costs.

Fresh Del Monte Produce (FDP) suspended its dividend. After taking on debt for an acquisition and suffering a slide in profits, the global producer and distributor of fruit and vegetables violated certain covenants of its credit facility, which restricted payments of dividends unless certain ratios were met. FDP shares fell 17% on the news.

Harvest Capital Credit (HCAP), a business development company, lowered its monthly dividend by 16%. Management cited a "very competitive investment environment" which caused the firm's earnings to decline, pushing Harvest's payout ratio well above 100%.

Clearway Energy (CWEN), an energy infrastructure investment company with long-term contracted assets, reduced its dividend by 40% as uncertainty swirled around one of its largest customers, Pacific Gas & Electric (PG&E). PG&E filed for bankruptcy, heightening the risk that it may not honor the power purchase agreements it has with Clearway. In such a scenario where project distributions are restricted, the firm's liquidity and leverage would take a hit. 

By cutting the dividend, Clearway could proactively maintain its balance sheet and capital allocation flexibility during this period of uncertainty. As more clarity is provided on the PG&E, management said they will reassess the dividend. For now, PG&E has neither assumed, rejected, or sought to renegotiate its contracts with Clearway.

Latin American airline Copa Holdings (CPA) lowered its dividend by 25%. Higher fuel prices along with economic and currency weakness in Brazil and Argentina hurt the company's profits, pushing its payout ratio too far above management's 40% target. Airlines are cyclical, capital-intensive businesses with high debt loads and volatile earnings, so their dividends can be less predictable.

CenturyLink (CTL), a regional telecom business, chopped its dividend by 54%. The firm was struggling to grow and had too much debt following years of costly acquisitions. Cutting the dividend provided the firm with more flexibility to reduce its leverage. CTL shares fell 10% on the news.

Unique Fabricating (UFAB) slashed its dividend by 67%. The manufacturer of foam and plastic components used in cars and appliances wanted to increase its financial flexibility so it could more aggressively reduce its debt.

Medley Capital Corporation (MCC) cut its dividend by 50%. The business development company contended with poor investment performance, which had pushed its payout ratio well above 100%, and faced uncertainty regarding a proposed controversial merger which many shareholders opposed.

After rejecting a takeover offer and appointing a new CEO all in the last month, aerospace parts manufacturer Arconic (ARNC) decided to cut its dividend by 67% and split its company in two, with plans to eventually spin off one of the businesses. 

Management's sudden operational overhaul came despite the company recording double-digit organic sales and earnings growth in the quarter. Arconic also maintained a payout ratio below 20% at the time of its dividend cut and announced a new $500 million share buyback program.

In other words, Arconic's dividend cut was a capital allocation decision tied to management's new strategic plans for the company rather than unhealthy business fundamentals. Cuts like these are unusual but often difficult to get in front of.

Pitney Bowes (PBI) cut its dividend by 73%. The firm's earnings had eroded nearly 50% over the past decade as its mailing solutions business faced secular headwinds. While Pitney Bowes maintained a reasonable payout ratio near 60%, it also operated with substantial leverage. Management opted to cut the dividend to direct more capital towards growth initiatives as the business continued its turnaround.

Despite paying uninterrupted dividends for more than 20 years and maintaining an earnings payout ratio below 60%, Tupperware Brands (TUP) cut its dividend by 60%. The maker of food storage containers, cookware, and beauty products was struggling to achieve profitable growth as consumers opted for cheaper alternatives and e-commerce challenged its direct-sales model. Management wanted to free up more cash to fund the firm's turnaround initiatives. TUP shares tumbled more than 25% on the news.

Vale (VALE) suspended its dividend after one of its dams suddenly burst in Brazil, causing billions of dollars of damages and widespread tragedy with over 60 lives lost. The Wall Street Journal reported that this was "the most deadly mining incident of its kind in more than 50 years."

Vale's business was actually in good financial shape before disaster struck. The firm's net debt was at its lowest level since 2009, its payout ratio sat below 30%, there were no major debt maturities through 2021, cash on hand exceeded $6 billion, and earnings were expected to grow at a double-digit pace next year. Moody's had even upgraded Vale's credit rating to Baa3 (investment grade) in July 2018.

However, with a major liability forming overnight, plus severe public outrage at the company (Vale wisely suspended executive bonuses as well), the firm's decision was a prudent one. Given the unforecastable nature of an event of this magnitude, coupled with Vale's otherwise solid financial health, we were unable to get in front of this dividend cut. 

We already use a separate scoring template for mining companies to conservatively account for their cyclical and capital-intensive operations, but there were no warning signs in this situation (a German safety certifier had even found the mine to be stable in September). Going forward, we will consider placing even more weight on a miner's long-term dividend track record to gauge how conservative its operations have historically been managed.

Fortunately, the vast majority of dividend cuts can be spotted in advance since they are not triggered by a single high-impact, low-probability event. Unlike Vale, dividend cutters often possess some combination of a dangerously high payout ratio, falling earnings, and too much debt; their financial health does not materially change overnight.

Dynagas LNG Partners LP (DLNG) reduced its distribution by 75% less than a year after management first cut the payout by 41%. The owner and operator of LNG carriers said it needed to retain more cash flow as it approached a significant debt maturity later this year, suggesting its refinancing efforts weren't going well. DLNG's stock plunged nearly 30% on the news.

Seadrill Partners (SDLP) cut its dividend by 90%. The provider of offshore contract drilling services experienced a decline in cash flow as dayrates remained weak, and the firm needed to preserve liquidity ahead of upcoming debt maturities.

CSI Compressco LP (CCLP), a provider of compression services and equipment for natural gas and oil producers, slashed its distribution by 95%. The firm's distribution had consumed all of its distributable cash flow over the past year, and its leverage was too high. Cutting the distribution frees up cash flow that management will use to redeem CSI Compressco's preferred units, which were significantly diluting common unit holders.

Crescent Point Energy Group (CPG) chopped its dividend by 89% due to the significant decline in the price of oil. The Canadian oil producer's payout ratio sat near 100%, its debt load was high, and management desired more financial flexibility.

Sage Stores (SSI) suspended its dividend. The department store retailer was losing money and decided to convert more of its locations to the off-price model, which is having more success. Eliminating the dividend was necessary to free up more cash for this strategy initiative, especially given the company’s significant financial leverage.

Teekay Offshore Partners L.P. (TOO) suspended its distribution. The marine energy transportation company desired to conserve more of its internally generated cash flows to reinvest in the business and reduce financial leverage.

Nabors Industries (NBR), a provider of drilling services and technologies for oil and gas wells, slashed its dividend by 83%. With the price of oil significantly declining, Nabors was losing money and needed to free up more cash to reduce its debt load.

Hi-Crush Partners LP (HCLP) suspended its distribution. The frac sand producer was challenged by soft market conditions as energy companies completed fewer wells, and management desired to protect the company's balance sheet. HCLP shares tumbled more than 15% on the news.

As a mortgage REIT, Anworth Mortgage (ANH) generates income primarily based on the difference between the yield on its long-term mortgage assets and the cost of its short-term borrowings. The flattening yield curve pressured the firm's earnings and kept its payout ratio above 100%, so Anworth reduced its dividend by 7%.

Capstead Mortgage's (CMO) earnings remained under pressure due to the flattening yield curve, which reduces the income generated by the adjustable-rate mortgage securities it invests in. With a payout ratio in excess of 100%, the mortgage REIT lowered its dividend by 27%.

AltaGas (ATGFF) cut its dividend by 56%. The owner of regulated utilities and midstream assets needed to direct more cash flow towards deleveraging efforts after taking on significant debt to acquire a natural gas utility for $9 billion. With midstream stock prices in a bear market, issuing equity was no longer a viable financing plan for the firm.

Communications Systems (JCS), a provider of connectivity products for broadband and voice communications, cut its dividend by 50%. The money-losing firm needed to restructure its operations and direct more capital to its best growth opportunities.

Ellington Residential Mortgage REIT (EARN) lowered its dividend by 8% in response to a flattening yield curve, which reduced its portfolio value, net interest margin, and core earnings. With a payout ratio above 100% and use of meaningful leverage, reducing its dividend was necessary.

Aceto (ACET) suspended its dividend. The chemical compounds manufacturer was hurt by a prolonged down cycle in the generic drug industry and was saddled with debt. Just two months after suspending its dividend, Aceto shocked many investors by filing for bankruptcy, sending its stock falling by more than 60%.

Capital Product Partners L.P. (CPLP) effectively cut its distribution by 43%. The owner of tanker, container, and drybulk vessels reduced its payout after deciding to spin off its crude and product tanker business, which reduced its cash flow. Although unitholders received a stake in the new spin-off, its weak profitability prevented it from paying a distribution.

Ferroglobe PLC (GSM) suspended its dividend. The silicon and specialty metal producer operates in a cyclical industry and saw its near-term outlook worsen, leading management to eliminate its dividend in order to save cash and deleverage its balance sheet.

Highway Holdings (HIHO) chopped its dividend by 50%. The industrial parts and components supplier had a payout ratio above 100% and was challenged by a double-digit drop in revenue as a large customer pulled back on orders.

Plagued by weak growth, declining profitability, and too much debt, mall-based retailer L Brands (LB) cut its dividend by 50% to free up more cash for deleveraging. L Brands had paid dividends without reduction for more than 25 consecutive years, and its stock price plunged 18% on the news.

Hugoton Royalty Trust (HGTXU) suspended its dividend.

Korea Electric Power Corporation (KEP) suspended its dividend.

Despite sporting a payout ratio below 30% and growing its quarterly revenue, Adient (ADNT) suspended its dividend. The automobile seat manufacturer was spun off from Johnson Controls (JCI) in 2016 and desired to improve its cash flow available for debt reduction.

Dean Foods (DF) cut its dividend by 67%. The milk processor and dairy products manufacturer was losing money and had a dangerously high debt load. Reducing its payout provided the company with more financial flexibility as it continued its turnaround plan.

Garrison Capital (GARS), a business development company, reduced its dividend by 18%. The firm's payout ratio had exceeded 100% due to a decline in earnings caused by lower fee income and an unrealized loss on one of its investments.

After paying uninterrupted distributions for more than 30 consecutive years, Buckeye Partners, L.P. (BPL) cut its distribution by 41%. The pipeline and storage terminal operator was challenged by weak oil market fundamentals.

As a result, the firm contended with an unsustainable payout ratio above 100%, needed to free up cash for debt reduction to protect its credit rating, and, with its stock price in the dumps, wanted to eliminate its need to access the public equity markets to fund annual growth capital.

Digirad (DRAD) eliminated its dividend in favor of using the money on share repurchases instead. The provider of diagnostic healthcare services was losing money so its stock price was in the dumps. 

Owens & Minor (OMI) cut its dividend by 71%, sending its stock price tumbling more than 40%. The medical supplies distributor had paid uninterrupted dividends since 1977, but its core customers (hospitals) were putting increased price pressure on the firm in an effort to cut costs. 

As growth in its legacy business struggled, management responded by making two large acquisitions in faster-growing segments, straining Owens & Minor's balance sheet and liquidity. The substantial dividend cut gives the company more breathing room to service its significant debt load while continuing to adapt its business model for the future.

Big 5 Sporting Goods (BGFV) chopped its dividend by 67% as the retailer of athletic shoes, apparel, and equipment couldn't sustain its payout ratio above 100% and needed to pay down debt as sales declined.  

General Electric (GE) axed its dividend for the second time in less than a year, this time reducing its payout by 92%. With power markets remaining weak and the company dealing with a very heavy debt load, GE needed to free up more cash to improve its balance sheet and give its turnaround efforts some breathing room.

CBL Properties (CBL) slashed its dividend by 63%. Declining occupancy and a very heavy debt load put pressure on the mall REIT to preserve liquidity and increase its financial flexibility.

Nam Tai Property (NTP) suspended its dividend.

Anheuser-Busch InBev (BUD) reduced its dividend by 50% as management wanted to speed up debt repayments following the firm's $100-billion-plus acquisition of SABMiller in 2016. 

BUD's dividend cut involved some discretion since the firm's free cash flow more than covered its dividend, sales and earnings were growing, and the beverage maker was not facing any liquidity issues.

In fact, management stated that from a liquidity standpoint "there is no pressure whatsoever" and that the company's nicely balanced debt maturities were "no big issue." 

These situations are rather unusual and can be hard to evaluate. On paper, the dividend seemed like it could have been sustained. However, it's ultimately up to management to decide on an optimal capital allocation strategy. In BUD's case, that meant taking action to accelerate the deleveraging process.

Manning & Napier (MN) cut its dividend by 75%. The investment manager was struggling with a decline in assets under management and had an unsustainable payout ratio above 100%. Reducing the dividend provided the firm with more breathing room as it worked to restructure its core business. 

Golar LNG Partners LP (GMLP) reduced its distribution by 30% after weak conditions in the shipping market stretched its balance sheet and pushed its payout ratio well above 100%.

After nearly tripling its quarterly distribution in July 2018, just three months later Hi-Crush Partners LP (HCLP) chopped its distribution by 70%. The frac sand producer was challenged by soft market conditions and also wanted to lower its payout ratio as it converted from a partnership to a corporation.

Ferrellgas Partners, L.P. (FGP) suspended its distribution. The propane distributor was saddled with debt following a failed effort to diversify its business into the midstream sector. Ferrellgas violated its bond covenants which prevented the firm from paying distributions.  

Government Properties Income Trust (GOV) slashed its dividend by 68%, sending the office REIT's stock price tumbling 25% on the news. Government Properties was challenged by an unsustainable payout ratio above 100%, too much leverage, high tenant concentration, and significant near term lease expirations. 

Cutting the dividend reduced the firm's payout ratio to management's target level of 75% and provided more financial flexibility as Government Properties pursued plans to merge with Select Income REIT (SIR).

Capstead Mortgage (CMO) continued to face interest rate headwinds and see its portfolio value decline, forcing the mortgage REIT to cut its dividend by 21% — the firm's third dividend cut this year.

The financially distressed shopping center REIT DDR Corp (DDR) reduced its dividend by 47% following the spin-off of its lower quality properties. Shareholders received shares in the newly formed company, RVI, but it's unclear whether RVI will pay a regular distribution, especially given the company's plans to sell off all assets within 5 years.

Lexington Realty Trust (LXP) cut its dividend by 42% in February 2019, but management first communicated a dividend reduction was coming in September 2018. The REIT decided to divest most of its office properties, reducing its cash flow generation, and used proceeds to reduce debt and acquire more industrial properties. 

Spirit Realty Capital (SRC) effectively lowered its dividend by 12% following its spin-off of Spirit MTA (SMTA). Including the shares investors were given in SMTA, annual dividends per share fell from 72 cents to 63.2 cents. The retail REIT opted to target a lower payout ratio near 75%, which is more in line with its peers. 

Orchid Island Capital (ORC) lowered its monthly dividend by 11% as interest rate volatility hurt the mortgage REIT's profitability.

Maiden Holdings (MHLD), a specialty reinsurance company, reduced its dividend by 67% as the firm struggled with underwriting losses.

New Senior Investment Group (SNR) cut its dividend by 50% due to the senior housing REIT's unsustainable payout ratio and substantial debt load. 

Farmland Partners (FPI) lowered its dividend by 61%. The farmland REIT's cash flow did not cover its dividend, and falling crop prices remained a challenge.

R.R. Donnelley & Sons (RRD) cut its dividend by 79% in order to use more cash flow for improving its heavily indebted balance sheet. The integrated communications company was struggling as commercial print sales remained weak. 

SCANA (SCG) slashed its dividend by 80% to preserve cash. The utility is seeking a resolution with regulators to recover costs for its failed $7.7 billion nuclear construction project. Shareholders, rather than utility ratepayers, will likely be on the hook for a substantial amount of the project's loss.

Corus Entertainment (CJREF) slashed its dividend by 79% to conserve more cash for debt reduction. The television and radio company's advertising revenue was under pressure, driven by the continued rise of digital marketing channels and over-the-top streaming services. The firm's shares plunged 18% to reach an all-time low.

Himax Technologies (HIMX) reduced its annual dividend by 57% due to weak results in its cyclical semiconductor business, as well as the firm’s need to ramp up spending to expand its manufacturing capacity. 

Anworth Mortgage Asset Corporation (ANH), a mortgage REIT, moved its dividend lower by 7% due to its high payout ratio and interest rate volatility that lowered the value of its investment portfolio.

Arlington Investment Corp (AI) reduced its dividend by 32%. Rising interest rates reduced the value of its mortgage-related investments, and the firm maintains a high payout ratio and substantial financial leverage. 

Capstead Mortgage (CMO) saw its portfolio value decline and borrowing costs rise as interest rates fluctuated, forcing the mortgage REIT to cut its dividend by 13%.

ClearOne (CLRO) eliminated its dividend. The developer of conferencing and collaboration communications solutions saw its revenue slump nearly 40% and reported a loss as a competitor infringing on its patents hurt adoption of one of its new platforms. To preserve cash, management suspended the dividend. Shares tumbled more than 15%.

Libbey (LBY) suspended its dividend in order to increase the glass manufacturer’s focus on debt reduction. 

Nordic American Offshore (NAO) dropped its dividend by 50% as the offshore oil & gas shipping market remained weak, keeping pressure on the capital intensive and unprofitable vessel company. 

Blueknight Energy Partners, L.P. (BKEP) cut its distribution by 45% as the provider of midstream energy services struggled with a coverage ratio below 1.0x, a weak crude oil storage market, and too much debt.

CrossAmerica Partners (CAPL) reduced its distribution by 16%. The motor fuels distributor had significant financial leverage and owed its general partner meaningful management fees. With the MLP market remaining weak, making issuing equity very dilutive, and the partnership’s payout ratio elevated, cutting the distribution freed up more internally generated cash flow for the business to use.

Aceto (ACET) slashed its dividend by 85% in response to the continued down cycle in the generics drug industry and the pressure it put on the company’s high debt load. 

TC Pipelines, LP (TCP) was adversely affected by a change in MLP regulations. The company needed to deleverage to prepare for lower future cash flow, and cutting its distribution by 35% was part of the solution. 

Diebold Nixdorf, Incorporated (DBD) suspended its dividend.

Nordic American Tankers (NAT) slashed its dividend by 67% as a weak tanker market caused the indebted vessel company to operate at a loss.  

SunCoke Energy Partners, L.P. (SXCP) reduced its distribution by 33% in order to help the company further pay down debt and maintain some cushion for its credit facility’s leverage covenant. 

Pier 1 Imports (PIR) suspended its dividend. The retailer of decorative accessories, furniture, candles, and housewares was saddled with debt, had an unsustainable payout ratio above 100%, and was experiencing sharp sales and earnings declines. Discontinuing the dividend freed up cash to help the distressed company's turnaround efforts.

Dynagas LNG Partners LP (DLNG) cut its distribution by 41% following a strategic review of the business. Management desired to improve the energy MLP's coverage ratio and strengthen its balance sheet after a drop in charter rates caused operating cash flow to decline.

Franklin Street Properties (FSP) reduced its dividend for the first time since 2008, announcing a 53% cut as the REIT transitions its property portfolio from a suburban to an urban orientation which results in higher leasing costs per square foot.

LaSalle Hotel Properties (LHO), a hotel REIT, cut its dividend by 50%. The firm saw revenue per available room decline in 2017 and expected another dip in 2018 as supply growth in many of its markets pressured the REIT's cash flow. 

Navios Maritime Midstream Partners L.P. (NAP) owns and operates tanker vessels. The company chopped its dividend by 70% in response to challenging market conditions and its need to maintain a healthy balance sheet. 

Five Oaks Investment Corp (OAK) dropped its dividend by 40% as a flattening yield curve hurt the mortgage REIT’s investment income. These businesses maintain high payout ratios and use significant financial leverage, so there is little margin for error. 

Capstead Mortgage (CMO) cut its dividend by 16% as shorter term interest rates increased at a faster pace than longer term interest rates, pushing down the value of the REIT’s mortgage-related investments.

Alcentra Capital (ABDC) is a business development company that cut its dividend by 28% due to underperforming credit investments and yield compression. 

National CineMedia (NCMI) announced a 23% dividend cut as its profits fell and the heavily indebted cinema advertising company needed more cash to reinvest in its business as it combats declining movie theater traffic.

IDT (IDT) swung to a loss and decided to invest more heavily in its growth initiatives, leading the telecom business to cut its dividend by 53%. 

CYS Investments (CYS) reduced its dividend by 12% after the mortgage REIT was challenged by falling investment income. 

A year after reducing its dividend by 19% to conserve cash, Wheeler Real Estate Investment Trust (WHLR) eliminated its dividend entirely in order to further improve the Retail REIT's weak balance sheet.

Colony NorthStar (CLNS) cut its dividend by 59%, sending its shares tumbling more than 20%. The REIT was challenged by negative headwinds in healthcare and across its retail broker-dealer distribution business. Combined with a dangerously high amount of debt, Colony NorthStar opted to cut its dividend to prioritize deleveraging and improve its financial flexibility.

Circor (CIR) suspended its dividend after completing a transformative acquisition which doubled the size of its business. The engineered products manufacturer maintained a payout ratio near 10% and wasn’t owned by many investors for its dividend. Management wanted to pay down debt from the acquisition as quickly as possible, leading to the decision.

Frontier Communications (FTR) eliminated its dividend to save cash since the telecom company was losing money and on the path towards bankruptcy. 

MercadoLibre (MELI), the largest online commerce ecosystem in Latin America, decided to eliminate its dividend in favor of using all of its cash internally for growth. This dividend cut was difficult to catch in advance for several reasons.

Specifically, MercadoLibre reported 71% sales growth the quarter it announced its dividend suspension, its free cash flow payout ratio was below 15%, the company had no debt, and its cash totaled nearly $600 million compared to annual dividend commitments of approximately $27 million. 

Simply put, management's decision to stop the dividend was not due to the firm's financial health, but rather a change in capital allocation policy to take advantage of growth opportunities. Here was the company's statement: 

"After reviewing our capital allocation process the Board of Directors has concluded that the Company has multiple investment opportunities that should generate greater returns to shareholders through investing capital into the business than issuing a dividend. Consequently, the decision has been made to suspend the payment of dividend to shareholders as of the first quarter of 2018, as it will free up capital for investment in multiple projects in our various platforms."

There's no easy way to get in front of these situations that involve so much management discretion, but fortunately they are very rare. Sticking with companies that have longer histories of paying stable dividends can help, and that is one of the factors our Dividend Safety Score system reviews.

MercadoLibre's dividend was quite small (MELI's dividend yield was less than 0.2%), and its stock price was largely unchanged on the news (and up over 80% in the year leading up to the cut). In other words, not only were few investors likely to have owned this stock for income in the first place, but any who did could have moved on to another idea without incurring a capital loss.

Macquarie Infrastructure Company (MIC), the fuel storage infrastructure specialist, dropped its dividend by 31%, sending its stock price tumbling more than 40%. The dividend cut will conserve cash to help the highly leveraged MLP preserve its credit rating and invest in growth projects after failing to renew some oil client contracts.

Dine Brands Global (DIN) chopped its dividend by 35% as its Applebee's and IHOP restaurant chains struggled and the company maintained a very high debt load.

Oaktree Strategic Income (OCSI) was challenged by volatile investment income and a high payout ratio, forcing the business development company to reduce its dividend by 26%.

NuStar GP Holdings, LLC (NSH) cut its distribution by 40% as the indebted MLP struggled to cover its payout and no longer had affordable access to external financing.

Harvest Capital Credit (HCAP) reduced its dividend by 16% after experiencing a significant drop in investment income. Shortly after, the firm delayed filing its annual report, underscoring the risks, complexities, and challenges of investing in many business development companies. 

NuStar Energy L.P. (NS) plunged as much as 21% on news that the pipeline operator was cutting its distribution by 45%. Costly acquisitions, hurricane damage, excessive financial leverage, and a need to free up more cash for investments were all factors. 

Oaktree Specialty Lending (OCSL) cut its dividend by 32% due to a decline in the business development company's investment income.   

Navios Maritime Acquisition (NNA), an owner and operator of tanker vessels, cut its dividend by 60% to preserve cash as the business struggled with too much debt and weak end market conditions. 

Collectors Universe (CLCT) lowered its dividend by 50% in response to a challenging quarter, an unsustainable payout ratio, and a need for the collectibles authenticator to redirect more cash toward growth opportunities. 

Nevsun Resources (NSU) suspended its dividend. The base metals mining and exploration company desired to free up more cash to fund large development projects as it combatted operating losses and production challenges. 

Five Oaks Investment Corp (OAKS) slashed its dividend by 33% as a flattening yield curve hurt the mortgage REIT's investment income.

Bluerock Residential (BRG) announced a 44% reduction to its dividend driven by the apartment REIT's decision to internalize its external management structure and implement a more sustainable payout ratio. 

PG&E (PCG) suspended its dividend. Wildfires were causing extensive damage throughout California, and regulated utility PG&E was under investigation to see if it caused some of the fires. If so, the company would face a large liability. Per The Wall Street Journal, California’s legal framework renders utilities liable for damages from wildfires started by their equipment, even if they weren’t negligent.

PG&E decided to preserve cash by temporarily suspending its dividend until more is known about the ongoing situation. We are not sure much could have been done to get in front of this one. This was a rather binary outcome that seemed to have a low probability at the time and couldn’t be traced in PG&E’s financial statements, which were otherwise in decent shape, or identified in analysts' earnings estimates for the year ahead, which were healthy.

Teva Pharmaceutical (TEVA) suspended its dividend entirely and was a great example of the dangers of debt. Prior to its dividend cut, Teva maintained a payout ratio below 30%, had paid uninterrupted dividends for more than 20 years, and was generating solid cash flow.

However, the company's debt spiked following its $40.5 billion acquisition of Actavis Generics in 2016. As generic drug prices came under pressure, Teva's urgency to conserve cash flow to service its debt load increased, ultimately resulting in two dividend cuts.

We have since added a new debt metric to our scoring system to better identify situations like Teva's, and we now also make use of forward-looking analyst estimates to spot companies with fundamentals that are more likely to continue deteriorating.

KCAP Financial (KCAP) was forced to lower its dividend by 17% due to a fall in its net investment income, which commonly causes issues for business development companies given their very high payout ratios.

Ellington Residential Mortgage REIT (EARN) reduced its dividend by 8% in response to a flattening yield curve, which reduced its net interest margin and core earnings. 

Fred’s (FRED) suspended its dividend. The regional discount chain faced a difficult competitive environment and couldn’t stem its operating losses. Coupled with a dangerously high amount of debt, Fred was forced to end its dividend.

General Electric (GE) cut its dividend by 50% to better align its payout with the firm's declining cash flow, preserve cash in light of its high financial leverage, and adjust its capital allocation framework under its new CEO. 

WisdomTree Investments (WETF) cut its dividend by 63%. ETF sponsors such as WisdomTree were under pressure to consolidate to keep their costs low. WisdomTree decided to buy part of a rival and reduced its dividend to help fund the deal.

FS Investment Corporation (FSIC) lowered its dividend by 15%. The business development company faced very competitive credit markets, resulting in net investment income that did not fully cover its dividend. As a result, management reducing the payout to a more sustainable level.

FS Investment (FSIC) lowered its dividend by 15% as underperforming investments and a high payout ratio weighed on the business development company.

Cameco (CCJ) slashed its dividend by 80% as depressed uranium prices eroded the energy producer's profits, pushing its payout ratio above 200%. The company had paid uninterrupted dividends for more than 20 years prior to the cut.

CECO Environmental (CECE) eliminated its dividend. The provider of industrial air quality and fluid handling systems was challenged by weakness in energy markets, resulting in a double-digit decline in revenue and earnings. Although CECE’s payout ratio remained below 100%, management suspended the dividend as part of a sweeping restructuring plan to turn the business around and provide more financial flexibility.

EVERTEC (EVTC) is a small-cap transaction processing business with operations centered in Latin America. Despite having a payout ratio near 20% at the time, management decided to temporarily suspend the firm's dividend due to unstable and uncertain operating conditions in Puerto Rico. 

Interestingly, EVTC's stock price subsequently rallied more than 50%, and in September 2018 the company began paying dividends (albeit at half the previous payout amount). Regardless, our scoring system now handles smaller companies more conservatively, reflecting their generally more concentrated business activities and more dynamic capital allocation policies.

RAIT Financial Trust (RAS) suspended its dividend. The provider of debt financing to commercial real estate owners was losing money and needed to reduce its leverage. Shares fell more than 10% on the news.

Franks International (FI) suspended its dividend. The provider of engineered tubular services for oil and gas producers was losing money following the crash in energy prices and wanted to preserve its liquidity for future investments.

CBL & Associates Properties (CBL) cut its dividend by 25% as the REIT had too much debt and declining funds from operations.

Alcentra Capital Corporation (ABDC) dropped its dividend by 27%. Underperforming investments and a high payout ratio led to the business development company's dividend reduction.

Ellington Financial (EFC) cut its dividend by 9% in order to free up additional capital for new investments. 

Mosaic (MOS) cut its dividend by 83%. The phosphate and potash producer contended with weak fertilizer market conditions and wanted to free up cash it could use to reach its target leverage ratio faster.

Rent-A-Center (RCII) suspended its dividend. The lessor of durable goods, such as appliances and electronics, on a rent-to-own basis was losing money and experiencing same-store sales declines. Eliminating the dividend provided the company with more flexibility for its turnaround plans.

Concurrent (CCUR) suspended its dividend. Management desired to preserve the real estate and cash advance company’s liquidity while evaluating potential acquisition targets and alternative uses of the firm’s remaining assets following a series of business dispositions.

Westmoreland Resource Partners, LP (WMLP) eliminated its distribution. The thermal coal producer was challenged by weak market conditions and had too much debt. The partnership had to suspend distributions after its leverage ratio exceeded the limit allowed in its debt agreements, and the firm would declare bankruptcy one year later.

Suburban Propane Partners (SPH) ran into trouble as two consecutive warm winters reduced demand for its propane and further stretched its weak balance sheet, causing the firm to reduce its dividend by 32%.

Toymaker Mattel (MAT) suspended its dividend after being hurt by its large customer Toys 'R' Us filing for bankruptcy. Mattel needed to strengthen its balance sheet and improve its financial flexibility to turn around its faltering business.

Waddell & Reed Financial (WDR) slashed its dividend by 46% as the investment manager continued experiencing asset outflows that pushed its payout ratio near 90%.

Oceaneering International (OII) suspended its dividend. The provider of engineered services and products to the offshore energy market was challenged by very weak pricing conditions in the oil market and wanted to free up more cash for opportunities.

MidSouth Bancorp (MSL) cut its dividend by 89%. Energy loans accounted for more than 20% of the bank’s total loan portfolio. Weak oil prices resulted in numerous problem loans, pressuring earnings and ultimately impairing the bank’s ability to maintain its dividend. 

Greenhill & Co. (GHL) slashed its dividend by 89%. The boutique investment bank saw its revenue slump more than 30% as it advised on fewer M&A deals and struggled to compete with other advisers. Management needed to redirect more cash flow to debt repayment, necessitating the dividend cut.

Genesis Energy, LP (GEL) needed to strengthen its balance sheet in order to continue having access to affordable capital for its growth projects, forcing the midstream energy MLP to chop its distribution by 31%. 

National American University (NAUH) eliminated its dividend entirely as the accredited institution of higher learning was in desperate need to preserve liquidity given its operational struggles, large debt burden, and spiking payout ratio. 

ATN International (ATNI), a small-cap telecom company, had increased its dividend for 20 consecutive years. Despite its healthy payout ratio and sub-3% yield, management decided to "strategically shift" the firm's capital allocation by reducing the firm’s dividend by 50% in favor of using the capital to invest more in growth opportunities. 

There is not an easy way to get in front of a shift like this when a firm's underlying fundamentals are solid, but we rate small-cap stocks more conservatively today since they can have more dynamic capital allocation policies over time.

Capstead Mortgage (CMO) lowered its dividend by 10% as net interest margins declined due to higher mortgage prepayment levels and higher borrowing costs, which pressured the mortgage REIT’s high payout ratio. 

Frontline (FRO) eliminated its dividend. The shipping company provides seaborne transportation of oil and was hurt by prolonged weakness in oil prices. As a result of soft shipping rates and too much industry supply, Frontline was losing money and opted not to resume paying dividends until it earned a profit.

Ship Finance International (SFL) cut its dividend by 22% due to the soft tanker market and the company’s dangerously high debt load. 

Prospect Capital (PSEC) reduced its dividend by 28%. The business development company’s net investment income declined due to the firm’s desire to avoid riskier investments and reduce originations.

Plains All American Pipeline, L.P. (PAA) needed to reduce debt to reach its targeted credit markets and lessen its dependence on raising growth capital via issuing equity. As a result, the midstream MLP slashed its distribution by 46%. 

Plains GP Holdings LP (PAGP) needed to reduce debt to reach its targeted credit markets and lessen its dependence on raising growth capital via issuing equity. As a result, the midstream MLP slashed its distribution by 46%. 

Chicago Bridge & Iron Company (CBI) completely eliminated its dividend despite maintaining a low payout ratio, sending its stock down over 25% on the news. The engineering and construction company was saddled with debt and dealing with depressed business results. 

Black Box (BBOX) suspended its dividend, sending its shares falling more than 40%. The IT infrastructure provider was saddled with debt and losing money, forcing it to amend its credit agreement. Stopping dividend payments freed up cash to help improve the company's financial health.

RAIT Financial Trust (RAS) chopped its dividend by 44% as management stepped up efforts to lower financial leverage and refocus the business on its core commercial real estate lending operations. 

Bristow Group (BRS) cut its dividend by 79% after a severe cyclical downturn in the offshore energy market caused the helicopter services business to operate at a loss. 

Teva Pharmaceutical (TEVA) cut its dividend by 75% and was a great example of the dangers of debt. Prior to its dividend cut, Teva maintained a payout ratio below 30%, had paid uninterrupted dividends for more than 20 years, and was generating solid cash flow.

However, the company's debt spiked following its $40.5 billion acquisition of Actavis Generics in 2016. As generic drug prices came under pressure, Teva's urgency to conserve cash flow to service its debt load increased, ultimately resulting in two dividend cuts (management suspended the dividend in December 2017).

We have since added a new debt metric to our scoring system to better identify situations like Teva's, and we now also make use of forward-looking analyst estimates to spot companies with fundamentals that are more likely to continue deteriorating.

Teekay Offshore Partners L.P. (TOO), a marine energy transportation company, cut its distribution by 91% due to too much debt, falling distributable cash flow, and weak end market conditions.

Windstream Holdings (WIN) saw its stock price plunge nearly 30% after it announced it was eliminating its dividend. The indebted telecom company was losing customers, needed to de-lever, and faced large expenditures to build out its fiber network.

Nordic American Tankers (NAT) slashed its dividend by 25% due to the capital-intensive shipping company’s declining cash flow and weak balance sheet.

Arlington Asset Investment Corp (AI) lowered its dividend by 12% to strengthen the investment firm’s balance sheet and better protect itself from instability in the mortgage sector.

Ampco-Pittsburgh Corporation (AP), an engineering products business, suspended its dividend entirely to put the funds towards debt repayment and growth initiatives to turn the unprofitable company around.

Mattel (MAT) cut its dividend by 61% due to its unsustainable payout ratio, high debt load, and need to reinvest for growth as its iconic toy brands, such as Barbie, struggled in an increasingly digital world. 

CIM Commercial Trust (CMCT), an office REIT, reduced its dividend by 43% as its payout ratio was too high after divesting various properties. 

Wheeler Real Estate Investment Trust (WHLR) slashed its dividend by 19% to conserve cash due to the retail REIT’s heavy debt load. 

Stage Stores (SSI) announced a 67% reduction to its dividend in response to a weak retail environment and the firm’s need to strengthen its balance sheet.

Tegna (TGNA) cut its dividend in half. The owner of TV and radio stations in 2017 spun off Cars.com, which does not pay dividends, and implemented a new capital structure and capital return policy going forward. Proceeds from the spinoff were used to help reduce the company’s high debt load.

Stein Mart (SMRT) responded to a weak retail environment, its heavy debt load, and declining earnings by eliminating its dividend entirely.

Nature’s Sunshine Products (NATR) eliminated its dividend. Although the nutritional and personal care products manufacturer reported growth in revenue and net income and maintained a reasonable balance sheet, management wanted to free up more capital to fund the firm’s expansion in China.

Time Inc. (TIME) chopped its dividend by 79% due to a severe decline in print advertising revenue and the company’s substantial amount of debt. Shares plunged 17% on the news.

Medley Capital (MCC) was forced to lower its dividend by 27% as a result of the business development company’s decreasing net investment income and high payout ratio.

Frontier Communications (FTR), a telecom services provider, announced a 62% cut to its dividend after struggling with customer losses and too much financial leverage.

Enbridge Energy Partners, L.P. (EEP) was challenged by weak commodity markets, heavy debt, and a need to internally fund more of its growth projects. As a result, the midstream energy MLP decreased its distribution by 40%.

Enbridge Energy Management, LLC (EEQ) chopped its dividend by 40% in order to strengthen its balance sheet and maintain a more sustainable coverage ratio. The energy company’s cash flow was hurt from weak commodity markets.

CSI Compressco LP (CCLP) suffered from high debt and weak energy prices. As a result, the natural gas company reduced its dividend by 50%.

Superior Industries (SUP), a small-cap vehicle wheel manufacturer, cut its dividend by 50%. The firm announced a transformative acquisition to nearly double in size. Due to its higher cost of financing as a smaller company, management reduced the dividend to help afford the deal. 

Superior Industries had paid uninterrupted dividends for more than 20 years prior to this event, so the cut was a surprise that could not have been predicted ahead of time without knowing the firm's intentions to make a big acquisition. We treat smaller firms more conservatively today to recognize their generally more dynamic capital allocation policies.

Dynex Capital (DX) slashed its dividend by 14% when the mortgage REIT was faced with higher interest rates, rising financing costs, and an unsustainable payout ratio.

New York Mortgage Trust (NYMT) experienced financial difficulties resulting in a dividend reduction of 17% when financial and bond markets became more volatile.

Capstead Mortgage (CMO) struggled after portfolio yields did not improve as management had expected. As a result, the mortgage REIT cut its dividend by 9%.

OHA Investment Corporation’s (OHAI) portfolio invested too much in weak energy companies, hurting its profitability. In order to help the highly leveraged business development company recover, its dividend was lowered by 67%.

Cypress Energy Partners, L.P. (CELP) is a pipeline services provider to the energy industry. In order to conserve cash due to its heavy debt load and softening commodity prices, the company chopped its distribution by 48%.

Manning & Napier (MN), an investment manager, experienced a meaningful decline in its assets under its management. As a result of its falling earnings and elevated payout ratio near 100%, the firm’s dividend was slashed by 50%.

BlackRock Capital Investment Corporation (BKCC) lowered its dividend 14% in response to underperforming investments the business development company had made in the troubled oil and gas sector.

TICC Capital (TICC) reduced its dividend by 31% as tighter loan spreads reduced the business development company’s investment income.

Seaspan (SSW), a water vessel leasing company, was challenged by excess industry supply and heavy debt. Management dropped the dividend by 67%.

Kindred Healthcare (KND) suspended its dividend in order to repay debt and free up more capital for growth. The home healthcare services company was losing money and operated with too much leverage.

Nevsun Resources (NSU), a base metals mining and exploration company, found itself needing more cash to fund large projects as it encountered production challenges and declining profitability. The business cut its dividend by 75%.

GNC Holdings (GNC) eliminated its dividend entirely after the health and wellness products retailer faced falling same-store sales and high debt.

Equity One (EQY) reduced its dividend by 18% as the shopping center REIT struggled with its high payout ratio and the continued rise of online shopping. 

Educational Development Corp. (EDUC) eliminated its dividend. The publisher of children’s books was growing rapidly but also maintained substantial debt. To continue funding its growth, the company amended its debt covenants which required it to suspend its dividend. 

Scorpio Tankers (STNG) slashed its dividend by 92% as a result of the tank vessel company’s heavy debt and declining cash flow as petroleum transportation markets remained weak.

Highway Holdings (HIHO), an industrial components manufacturer, chopped its dividend by 30% as it faced declining sales, lower profitability, a high payout ratio, and a dangerous amount of financial leverage.

Columbia Property Trust (CXP) cut its dividend by 33% due to the office REIT’s disposal of lower quality properties and need to strengthen its balance sheet.

Fifth Street Finance Corp (FSC) slashed its dividend by 61% as the business development company responded to its declining investment income, excessive financial leverage, and need to restructure.

Alon USA Partners, LP (ALDW), an integrated downstream oil refinery company, dropped its dividend by 27% after the MLP experienced declining sales, falling distributable cash flow, and increasingly risk credit metrics. 

The Mosaic Company (MOS), a phosphate and potash producer, cut its dividend by 46% after weak fertilizer markets, declining cash flow, and too much debt pressured the business. 

Ericsson (ERIC), a diversified communications equipment provider, responded to challenging telecom market conditions and its heavy debt burden by reducing its dividend by 73%.

Meridian Bioscience (VIVO) turned to slashing its dividend by 38% as the life science company’s most profitable segment was weak and recovering slower than expected, creating a dangerously high payout ratio. The stock was down over 20% on the news.

Nordic American Tankers (NAT) lowered its dividend by 23% as weak shipping market conditions caused cash flow to decline, the company’s balance sheet was strained, and the capital-intensive tanker business needed to preserve capital. 

Pearson (PSO) suffered from declining demand for its textbooks and its significant financial leverage. The educational products company reduced its dividend by 72%.

ARMOUR Residential REIT (ARR) experienced declining revenue and needed to conserve cash due to its heavy debt load and high payout ratio. The mortgage REIT lowered its dividend by 14%.

Resource Capital Corporation (RSO) suffered from underperforming debt investments, high financial leverage, and an unsustainable payout ratio. In response, the mortgage REIT slashed its dividend by 88%.

KCAP Financial (KCAP) is a business development company that cut its dividend by 20% due to falling net investment income and its stretched balanced sheet.

Liberty Property Trust (LPT), an industrial and office REIT, reduced its dividend by 16% in response to the company’s restructuring and asset sales, which will reduce future cash flow. 

Investors Real Estate Trust (IRET) cut its dividend by 46%. The residential REIT's payout was no longer covered by its cash flow, and the firm carried too much debt. Management desired more financial flexibility to improve and grow IRET's portfolio of multifamily properties. 

Investors Real Estate Trust (IRT) cut its dividend by 46% as the diversified REIT combatted a high payout ratio and declining cash flow caused by volatile energy markets and increased supply. 

CoreCivic (CXW), a REIT providing prison facilities used by government agencies, slashed its dividend by 22% due to declining cash flow and regulatory headwinds as several federal agencies considered ending their use of privately run prisons.

Comtech Telecommunications (CMTL) was strained by its significant financial leverage and challenging business conditions. The communications equipment business cut its dividend by 67%.

Allegheny Technologies (ATI), a specialty metals manufacturer, suspended its dividend entirely due to weak end markets and a desperate need to shore up its indebted balance sheet.

PennantPark (PNNT) reduced its dividend by 36% after the investment firm suffered from weak energy markets, falling yields, and decreasing investment income.

Daxor Corporation (DXR), a medical and biotechnology company, lowered its dividend by 33% to free up cash for investment.  

THL Credit (TCRD) was challenged by lower yields and refused to invest in riskier assets. Combined with its high payout ratio, the business development company was forced to reduce its dividend by 21%.

Garrison Capital (GARS) reduced its dividend by 20%. The business development company suffered several debt investment losses, pushing its payout ratio above 100%. Combined with management’s more conservative lending guidelines, Garrison Capital needed to realign its dividend with its lower earnings projection going forward.

Horizon Technology Finance (HRZN) slashed its dividend by 13% as the business development company experienced lower interest income due to its shrinking loan portfolio.

Ellington Financial (EFC), a mortgage REIT, lowered its dividend by 10% after bond volatility hurt the value of its investment portfolio. 

Westmoreland Resource Partners, LP (WMLP) needed to preserve cash after being affected by a weak thermal coal market. The highly indebted energy MLP slashed its distribution by 33% to help with its recovery.

North European Oil Royalty Trust (NRT) chopped its dividend by 48% in response to weak energy markets and delayed royalty payments.

StoneMor Partners (STON) had increased its distribution each year since 2005 prior to announcing a 50% cut. The stock collapsed 45% on the news. The operator or cemeteries and funeral homes was experiencing sluggish revenue growth due to the rise in popularity of cremation over traditional burials. StoneMor Partners also operated with significant financial leverage, and its payout ratio had climbed to unsustainable levels in recent years.  

Oceaneering International (OII) cut its dividend by 44% despite its healthy free cash flow generation and balance sheet. The provider of engineered services and products to the offshore energy market believed it to be prudent to cut its payout given weak oil prices.

Telefonica (TEF) needed to accelerate its debt reduction efforts in order to preserve its investment grade credit rating. The telecommunications company slashed its dividend by 25%.

Martin Midstream Partners (MMLP) was hurt by lower oil prices, too much financial leverage, and a need to preserve cash in light of its increasing cost of capital. The midstream energy MLP reduced its distribution by 39%.

Diebold (DBD) acquired Wincor Nixdorf for $1.9 billion, which negatively impacted the company’s balance sheet. The services, software, and hardware company responded by lowering its dividend by 65% to help its deleveraging efforts.

Ferrellgas Partners, L.P. (FGP) cut its distribution by 81%. In an effort to diversify its business, in June 2015 the propane distributor paid $837.5 million to acquire Bridger Logistics, a midstream energy company. This deal saddled Ferrellgas with debt, forcing management to slash the distribution to protect the balance sheet when oil prices remained low and various legal issues arose.

Viacom (VIA) chopped its dividend by 50% in order to strengthen the media company’s balance sheet, improve its liquidity and invest in opportunities to grow its core business. 

SeaWorld Entertainment (SEAS) suffered from a heavy debt load, a high payout ratio, and bad publicity surrounding its killer whale shows. The company responded by dropping its dividend by 52% and eliminating it completely one quarter later.

San Juan Basin Royalty Trust (SJT) experienced financial turmoil from lower gas prices, resulting in a 34% decrease to its dividend.

Mesa Royalty Trust (MTR) responded to lower gas prices by reducing its dividend by 36%. 

Marine Petroleum Trust (MARPS) lowered its dividend by 41% in response to declining earnings caused by lower oil prices.

Communications Systems (JCS), a network services and architecture company, cut its dividend by 75% as it was losing money and wanted to direct more resources towards growth initiatives.

Medley Capital (MCC) reduced its dividend by 27% after the business development company experienced falling net investment income.

Houston Wire & Cable (HWCC) responded to weak industrial demand, depressed energy markets, and its net losses by slashing its dividend by 50%.

Textainer Group (TGH) needed to conserve cash due to container lessor company’s heavy debt load and low prices for new and used containers. They dropped their dividend by 88%.

Textainer Group Holdings Limited (TGH), a container leasing company, cut its dividend by 88% as it struggled with its high debt load and weak market conditions.

PDL BioPharma (PDLI) eliminated its dividend entirely in order to free up cash for strategic investments and provide financing for long-term growth.

Apollo Investment (AINV) suffered from high financial leverage and reduced its dividend by 25% as part of the management investment company’s restructuring strategy.

Computer Programs (CPSI) lowered their dividend by 47% as they moved to a variable dividend policy in response to fluctuation in sales and profits and too much financial leverage.

Calumet Specialty Products Parnters, L.P. (CLMT), a producer of petroleum-based specialty products, eliminated its distribution to strengthen its balance sheet and preserve capital.

Murphy Oil (MUR), an oil and gas exploration and production company, responded to depressed commodity prices and ongoing operating losses by cutting its dividend by 29%.

Medallion Financial (MFIN) struggled with an underperforming loan portfolio and weak liquidity. This resulted in the specialty finance company dropping its dividend by 80%.

Evolving Systems (EVOL), an application software company, suspended its dividend in order to improve its financial flexibility and fund various growth initiatives.

Williams (WMB) reduced its dividend by 69% due to weak energy markets and a need to protect the natural gas company’s credit rating.

North European Oil Royalty Trust (NRT) encountered trouble with depressed energy markets and delayed royalty payments, leading the firm to reduce its dividend by 38%.

CVR Partners (UAN) was losing money, so the indebted nitrogen fertilizer company responded by lowering its dividend by 37%. 

Potash (POT), a potash, nitrogen, and phosphate products company, lowered its dividend by 60% due to weak fertilizer markets.

American Capital Agency (AGNC), a mortgage REIT, cut its dividend by 10% due to volatile market conditions, unfavorable interest rate fluctuations, and its high payout ratio.  

Seadrill Partners LLC (SDLP) wanted to improve its liquidity position after numerous energy customers cancelled their contracts. The offshore drilling rig company reduced its dividend by 60%.

Cross Timbers Royalty Trust (CRT) decided to drop its dividend by 11% in response to lower oil and gas volumes and its high payout ratio.