Summary Of Dividend Changes In Q2 2020

This article provides a summary of dividend changes in the second quarter of 2020 (Q2 2020), as covered in the weekly Dividend Changes article series co-produced with James Marino Sr. of Portfolio Insight.

We monitor dividend change announcements for stocks listed in Dividend Radar, a weekly auto-generated spreadsheet of stocks with dividend streaks of five years or more. Dividend Radar provides up-to-date fundamentals and added value data, including total trailing returns, a fair value indicator, and trailing dividend growth rates.

In preparing for this article, I excluded dividend increases of stocks not in the latest available Dividend Radar list (dated July 10, 2020). In Q2 2020, I covered dividend increases announced by 88 companies. Additionally, 15 companies announced dividend suspensions and 34 companies decreased their dividend payment.

Top Increases

Here is a summary of the top 10 increases in Q2 2020:

Source: Created by the author

The following company descriptions are the author’s summary of company descriptions sourced from Finviz.

• Newmont Corporation (NEM) — Materials

NEM engages in the production and exploration of gold, copper, silver, zinc, and lead. The company has operations and/or assets in the United States, Canada, Mexico, Dominican Republic, Peru, Suriname, Argentina, Chile, Australia, and Ghana. NEM was founded in 1916 and is headquartered in Greenwood Village, Colorado.

• UnitedHealth Group Incorporated (UNH) — Health Care

Founded in 1974 and based in Minnetonka, Minnesota, UNH is a diversified health and well-being company with core capabilities in clinical expertise, advanced technology, and data and health information. The company provides medical benefits to customers in the United States and in more than 125 other countries.

• Tetra Tech, Inc. (TTEK) — Industrials

TTEK provides consulting and engineering services worldwide. The company offers early data collection and monitoring, data analysis and information, science and engineering applied research, feasibility studies and assessments, climate change and energy management consulting, and greenhouse gas inventory assessment, certification, reduction, and management services. TTEK was founded in 1966 and is headquartered in Pasadena, California.

• The Kroger Co. (KR) — Consumer Staples

KR, along with its subsidiaries, operates retail food and drug stores, multi-department stores, jewelry stores, and convenience stores across the United States. The company’s banner brands include Kroger, Ralphs, Fred Meyer, and King Soopers, as well as Simple Truth and Simple Truth Organic. KR was founded in 1883 and is headquartered in Cincinnati, Ohio.

• Werner Enterprises, Inc. (WERN) — Industrials

WERN, a transportation and logistics company, engages in transporting truckload shipments of general commodities in interstate and intrastate commerce in the United States, Mexico, Canada, and China. It operates in two segments, Truckload Transportation Services, and Werner Logistics. WERN was founded in 1956 and is headquartered in Omaha, Nebraska.

• Watsco, Inc. (WSO) — Industrials

WSO distributes air conditioning, heating, and refrigeration equipment in the United States, Canada, Mexico, and Puerto Rico. The company offers residential ducted and ductless air conditioners; gas, electric, and oil furnaces; commercial air conditioning and heating equipment systems; and other specialized equipment. WSO was founded in 1945 and is headquartered in Miami, Florida.

• Power Integrations, Inc. (POWI) — Information Technology

POWI designs, develops, and markets analog and mixed-signal integrated circuits, and other electronic components and circuitry used in high-voltage power conversion. The company sells its products to original equipment manufacturers and merchant power supply manufacturers. POWI was founded in 1988 and is headquartered in San Jose, California.

• Algonquin Power & Utilities Corp. (AQN) — Utilities

AQN owns and operates a portfolio of regulated and non-regulated generation, distribution, and transmission utility assets in Canada and the United States. It generates and sells electrical energy through non-regulated renewable and clean energy power generation facilities. AQN was incorporated in 1988 and is headquartered in Oakville, Canada.

• American Water Works Company, Inc. (AWK) — Utilities

AWK is the largest publicly-traded water and wastewater utility company in the United States. Through its subsidiaries, the company provides water and wastewater services in 45 states and in Ontario, Canada. The company is headquartered in Voorhees, New Jersey and was founded in 1886 as the American Water Works & Guarantee Company.

• Northrop Grumman Corporation (NOC) — Industrials

Founded in 1939 and based in Falls Church, Virginia, NOC is a leading global security company with both government and commercial customers. NOC provides systems, products, and solutions in unmanned systems; cybersecurity; command, control, communications, and computer intelligence; surveillance and reconnaissance; and logistics and modernization.

Please note that I’m not recommending any of these stocks. Readers should do their own research on these companies before buying shares.

Analysis of Increases

Here is a table of tickers in 5 different categories based on the percentage of each dividend increase. The tickers of stocks in my portfolio are highlighted:

Source: Created by the author

The following table presents a summary of average dividend increases by Increase Category, along with average dividend yield and average years of consecutive dividend increases:

Source: Created by the author

Generally, there is an inverse correlation between the average increase and both average yield and average streak (though the inverse correlation is not perfect in the case of the average yield).

Other Statistics

The following table presents a summary of the average overall increase (i.e., for the 80 stocks included in this analysis) and by sector. Also included are the average yield and average streak, overall and by sector:

Source: Created by the author

In the table, the highest and lowest averages are indicated with green and red cells, respectively.

Top Increases By Sector

Finally, here are the top dividend increases by sector.

Source: Created by the author

The following company descriptions are the author’s summary of company descriptions sourced from Finviz.

• Cogent Communications Holdings, Inc. (CCOI) — Communication Services

Founded in 1999 and headquartered in Washington, D.C., CCOI provides high-speed Internet access and Internet protocol communications services to small and medium-sized businesses, communications service providers, and other bandwidth-intensive organizations in North America, Europe, and Asia. CCOI offers bandwidths up to 100 Gigabits per second.

• Shoe Carnival, Inc. (SCVL) — Consumer Discretionary

SCVL, together with its subsidiaries, operates as a family footwear retailer in the 35 states in the USA as well as in Puerto Rico. The company offers various dress, casual, and athletic footwear products for men, women, and children. SCVL was founded in 1978 and is based in Evansville, Indiana.

• The Kroger Co. — Consumer Staples

See above.

• Pembina Pipeline Corporation (PBA) — Energy

PBA provides transportation and midstream services for the energy industry in North America. The company’s Pipelines segment operates conventional, transmission, and oil sands and heavy oil pipeline assets. Its Facilities segment offers processing and fraction facilities, and other infrastructure-related services. PBA was founded in 1997 and is headquartered in Calgary, Canada.

• CNO Financial Group, Inc. (CNO) — Financials

CNO is a holding company for a group of insurance companies operating throughout the United States. The company develops, markets, and administers health insurance, annuity, individual life insurance, and other insurance products for senior and middle-income markets. CNO was founded in 1979 and is headquartered in Carmel, Indiana.

• UnitedHealth Group Incorporated — Health Care

See above.

• Tetra Tech, Inc. — Industrials

See above.

• Power Integrations, Inc. — Information Technology

See above.

• Newmont Corporation — Materials

See above.

• Alexandria Real Estate Equities, Inc. (ARE) — Real Estate

ARE is a self-administered and self-managed REIT engaged in the ownership, operation, management, development, acquisition, and redevelopment of properties for the life sciences industry. Its properties consist of buildings containing scientific research and development laboratories, and other improvements. ARE was founded in 1993 and is based in Pasadena, California.

• Algonquin Power & Utilities Corp. — Utilities

See above.

Again, please note that I’m not recommending any of these stocks. Readers should do their own research on these companies before buying shares.

Dividend Cuts and Suspensions

Following requests from readers, we started covering dividend cuts and suspensions in our weekly article series. We only covered dividend cuts and suspensions announced by companies that were members of the Dividend Radar list at the time of such announcements. Of course, as soon a company announced a dividend cut or suspension, it was removed from the Dividend Radar list.

In all, 34 companies decreased their dividend payments and 15 companies announced dividend suspensions in Q2 2020.

1. Apr. 16: Green Plains Partners (GPP) cut its distribution by 75%.
2. Apr. 20: Moelis & Company (MC) cut its dividend by 50%.
3. Apr. 20: Western Midstream Partners (WES) cut its dividend by 50%.
4. Apr. 22: Black Stone Minerals (BSM) cut its dividend by 73%.
5. Apr. 23: Holly Energy Partners (HEP) cut its distribution by 48%.
6. Apr. 23: Invesco (IVZ) cut its dividend by 50%.
7. Apr. 23: 1st Source (SRCE) cut its dividend by 3%.
8. Apr. 23: USD Partners (USDP) cut its dividend by 70%.
9. Apr. 24: CenterPoint Energy (CNP) cut its dividend by 48%.
10. Apr. 24: Community West Bancshares (CWBC) cut its dividend by 18%
11. Apr. 28: American Assets Trust (AAT) cut its dividend by 33%.
12. Apr. 27: CNX Midstream Partners (CNXM) cut its dividend by 80%.
13. Apr. 29: Gaming and Leisure Properties (GLPI) cut its dividend by 14%.
14. Apr. 30: Great Western Bancorp (GWB) cut its dividend by 50%.
15. Apr. 28: Harley-Davidson (HOG) cut its dividend by 95%.
16. Apr. 29: Methanex (MEOH) cut its dividend by 90%.
17. Apr. 29: Marine Products (MPX) cut its dividend by 33%.
18. Apr. 28: Rollins (ROL) cut its dividend by 33%.
19. Apr. 29: Winmark (WINA) cut its dividend by 80%.
20. Apr. 30: Woodward (WWD) cut its dividend by 71%.
21. May 3: Great Ajax (AJX) cut its dividend by 48%.
22. May 5: WestRock (WRK) cut its dividend by 57%.
23. May 8: Brookfield Infrastructure Partners (BIP) cut its dividend by 10%.
24. May 6: Wendy’s (WEN) cut its dividend by 58%.
25. May 6: Extended Stay America (STAY) cut its dividend by 96%
26. May 11: Preferred Apartment Communities, Inc. (APTS) cut its dividend by 33%.
27. May 15: PBF Logistics LP (PBFX) cut its dividend by 42%.
28. May 20: Haverty Furniture Companies, Inc. (HVT) cut its dividend by 26%.
29. May 20: Haverty Furniture Companies, Inc. (HVT.A) cut its dividend by 26%.
30. May 28: Lamar Advertising Company (LAMR) cut its dividend by 50%.
31. Jun. 8: Urstadt Biddle Properties Inc. (UBA) cut its dividend by 75%.
32. Jun. 8: Urstadt Biddle Properties Inc. (UBP) cut its dividend by 75%.
33. Jun. 18: Kite Realty Group Trust (KRG) cut its dividend by 84%
34. Jun. 29: Simon Property Group, Inc. (SPG) cut its dividend by 38%.

Dividend Suspensions Announced in Q2 2020:

1. Apr 1: Gannett (GCI) suspended its dividend.
2. Apr 3: Herman Miller (MLHR) postponed its upcoming dividend and suspended future dividends.
3. Apr 8: Six Flags Entertainment (SIX) suspended its dividend.
4. Apr 16: Goodyear Tire & Rubber (GT) suspended its dividend.
5. Apr 17: Kohl’s (KSS) suspended its dividend.
6. Apr 22: Retail Opportunity Investments (ROIC) suspended its dividend.
7. Apr 30: Marcus (MCS) suspended its dividend.
8. May 1: Weyerhaeuser (WY) suspended its dividend.
9. May 5: Walt Disney (DIS) announced it would forgo its H1 dividend.
10. May 11: Tanger Factory Outlet Centers, Inc. (SKT) suspended its dividend.
11. May 13: Penske Automotive Group, Inc. (PAG) suspended its dividend.
12. May 20: Ross Stores, Inc. (ROST) suspended its dividend.
13. May 20: Ruth’s Hospitality Group, Inc. (RUTH) suspended its dividend.
14. May 23: TJX Companies Inc. (TJX) suspended its dividend.
15. Jun 5: Taubman Centers, Inc. (TCO) decided not to declare a second-quarter dividend, effectively suspending its dividend.

Concluding Remarks

Given the impact of the COVID-19 pandemic, it is not too surprising to see that “only” 80 dividend increases were announced in Q2 2020. Below is a comparison with the statistics from the summary article of Q1 2020.

Source: Created by the author

Avg Yield was quite high in Q1 2020 because of the market’s precipitous decline in late February and early March. Since then, the markets have recovered nicely, pushing Avg Yield lower again. It is not surprising to see a lower average percentage increase in Q2 2020, nor is it too surprising to see a higher Avg Streak for the stocks that did increase their dividend in Q2 2020.

Thanks for reading and happy investing!

Disclosure: I am/we are long AAPL, CB, IBM, JNJ, NOC, O, PG, QCOM, TRV, UNH, WPC. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.