The trading halt came just after 3 p.m. on Tuesday. Activity in Anadarko Petroleum Corp. (APC) shares froze … and investors everywhere wondered what the pending news would be.
Shortly thereafter, APC confirmed the worst. It would slash its quarterly dividend by 81% — to just 5 cents a share from 27 cents a share previously. The energy company desperately needs cash in this era of low oil and gas prices, and the move is designed to save $450 million annually.
APC is far from alone, too. ConocoPhillips (COP) just cut its dividend by 66%. Marathon Oil (MRO) slashed its payout by 76%. And these aren’t just a few cherry-picked examples. A whopping 394 companies reduced their dividends last year. That was up sharply from 243 a year earlier and the most since the Great Recession year of 2009 (527).
|Dividends are great for investors — but they’re no sure thing.|
A separate analysis by Goldman Sachs Group (GS) concluded that institutional investors are expecting overall dividends to rise by just 1.3% this year. That would be the smallest increase since 1950.
This just goes to show how important dividend stability is. You can’t just look at dividend yield and conclude a stock is a good buy. You have to evaluate the fundamental health of the company, the industry it operates in, and other factors to confirm that yield won’t go up in a puff of smoke!
Our Weiss Ratings can definitely help. They provide independent, conflict-of-interest-free evaluations of a company’s fundamental strength. Those with ratings in the “A” and “B” categories are considered “buys,” and have passed our rigorous screens.
In fact, I take the Weiss Ratings under consideration when I make recommendations in my Safe Money Report. But I also go a step further, conducting my own fundamental, technical, sector-based and sentiment-based analysis.
Is Your Stock Portfolio Taking a Hit?
Most investors’ are. The S&P 500 is down about 13% since July of last year. The Nasdaq is down 18%.
But there is an alternative: The currency market!
You see, unlike stock markets, the currency investment markets never crash.
No matter what’s going on in the world, currencies will always rise and fall against each other, giving you the opportunity to make money.
What’s more, currencies move independently of stock markets. Even if every stock market on the planet fell to zero, you could still build a fortune in currencies.
That analysis helped me identify a select handful of higher-yielding, lower-volatility stocks in non-economically sensitive sectors, which I recommended to my readers in the past several months. I’m happy to report that they have vastly outperformed the averages in these turbulent times, and that they are continuing to spin off above-market — and reliable — dividends.
Those recommendations are here. Or just be sure you do your yield-hunting in sectors like consumer non-durables and utilities rather than energy, materials, transportation, industrials, and financials. That’s where I see yields that are both generous and sustainable.
Until next time,
P.S. The last time oil prices sank below $50 a barrel, the best oil and energy stocks handed investors like you TRIPLE-DIGIT profits! The world’s best oil and energy companies are now HUGE investment opportunities — and you can buy all the shares you want for 50% to 90% off the recent price! Click here for my free report now!