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GM’s Dividend Safety Profile Not yet Affected by Union Strike but the Long-Term Stakes Are High

General Motors (GM) remains locked in its longest labor dispute since 1970, costing the company more than $1 billion according to JPMorgan Chase and The Wall Street Journal. Nearly half of GM's workforce is represented by the United Auto Workers (UAW) union. The automaker's contract with the UAW expired last month, with the UAW's nationwide strike beginning [...]

October 8th, 2019|Uncategorized|

Imperial’s Dividend Safety Score Downgraded to Unsafe on Vaping Challenges, Management Change

On September 26, Imperial Brands (IMBBY) lowered its guidance for the year due to challenging conditions in the U.S. vapor market. One week later, Imperial's CEO Alison Cooper stepped down after leading the company since 2010. Ms. Cooper had spearheaded Imperial's push into the vaping category. As a result of these developments, which seem likely to pressure the firm's [...]

October 7th, 2019|Uncategorized|

Starbucks: Impressive Brand Strength and Dividend Growth

The first Starbucks (SBUX) cafe opened in 1971, and the company has since grown to become the world’s largest coffee purveyor with over 29,000 stores in 78 countries. Starbucks stores sell not just premium coffee but also tea, packaged coffee, juices, bottled water, pastries, and various lunch items. In addition, the company licenses several of [...]

October 4th, 2019|Uncategorized|

Disney’s Appeal as a Long-term Dividend Growth Stock

Walt Disney founded his namesake company in 1923. Since then, the business has gone on to become one of the most iconic brands ever created. Today, Walt Disney (DIS) is a leading entertainment company with $65 billion in revenue.  The media conglomerate is highly diversified and vertically integrated with four business segments that complement one [...]

September 30th, 2019|Uncategorized|

McDonald’s: A Quality Dividend Aristocrat

Founded in 1940, McDonald's (MCD) is the world's largest quick-serve restaurant chain, with over 38,000 locations in more than 100 countries. Almost all of its restaurants are franchised, meaning the stores are owned and operated by independent business owners. Under a typical franchise arrangement, McDonald's owns or leases the property while the franchisee pays for [...]

September 30th, 2019|Uncategorized|

Wells Fargo Names New CEO, Improving Turnaround Prospects

Wells Fargo (WFC) finally appointed a new CEO to lead the bank following a six-month search effort. Charlie Scharf took the job and will start on October 21. The market was pleased, sending shares of Wells Fargo higher by about 4% today. Before taking the job, Scharf was CEO of Bank of New York Mellon (BK), a [...]

September 27th, 2019|Uncategorized|

Prospect Capital’s Dividend Safety Score Downgraded to Unsafe on Investment Performance Risks

Prospect Capital (PSEC) is one of the largest and oldest business development companies, or BDCs.  All BDCs are basically middle market lenders, which means they lend to or take equity stakes in the 200,000 or so subprime businesses that generate about a third of the U.S. economy.Essentially, BDCs serve a market of small companies across [...]

September 27th, 2019|Uncategorized|

No Merger, But Investors Await More Clarity From Management

On September 25, Altria (MO) announced that merger discussions with Philip Morris (PM) ended with no deal. The environment for vaping products weakened significantly over the last month due to increased regulatory uncertainty, which likely prevented the two tobacco giants from reaching an agreement. Philip Morris's stock jumped more than 5% on the news as its shareholders were relieved [...]

September 26th, 2019|Uncategorized|

Philip Morris Ends Merger Talks With Altria, Removing Some Uncertainty

This morning Philip Morris (PM) announced that merger discussions with Altria had ended without a deal. Investors responded positively to the news, lifting PM's stock price by about 5% in early trading. As we discussed earlier this month, shareholders were concerned that a merger would increase Philip Morris's risk profile by exposing the company to a more dynamic and [...]

September 25th, 2019|Uncategorized|

Altria’s Dividend Safety Score Downgraded to Borderline Safe on Increased Merger Uncertainty

Increasing regulatory headwinds in recent weeks have clouded the long-term outlook for part of Altria's (MO) business. These issues appear unlikely to threaten Altria's dividend assuming the company remains independent. However, they have created greater uncertainty about the terms Altria would receive if management decides to push forward with a merger with Philip Morris (PM). Due to [...]

September 24th, 2019|Uncategorized|

Lowe’s: A Quality Dividend King With Enduring Advantages

Lowe's (LOW) was founded in 1946 and is the world’s second largest home improvement retailer. The company operates over 2,100 home improvement and hardware stores (almost all in the U.S.) and helps homeowners, renters, and other customers complete a wide array of projects. The company’s stores are famous for being a one-stop shop for both [...]

September 23rd, 2019|Uncategorized|

Royal Bank of Canada: Paying Dividends Every Year Since 1870

With roots tracing back to the 1860s, Royal Bank of Canada (RY), or RBC, is one of the oldest and largest banks in the world. The firm is well-diversified across businesses, geographies, and client segments, serving 16 million customers across Canada, the U.S., and more than 30 other countries. RBC operates through five business segments:  Personal [...]

September 23rd, 2019|Uncategorized|

Oxy’s Safe Dividend Safety Score Remains Fragile Due to Debt, Oil Risks

Shares of Occidental Petroleum (OXY) are down more than 30% since early April 2019 when Oxy emerged as the high bidder for Anadarko. As a result, Oxy's dividend yield topped 7% last month, reaching an all-time high. Although Oxy's dividend continues to look sustainable based on the price of oil today, investors clearly remain concerned [...]

September 17th, 2019|Uncategorized|

Target: Paying Higher Dividends for 46 Consecutive Years

Target (TGT) opened its first discount store in 1962 and is now one of America's largest retailers with annual sales of $70 billion and more than 1,800 stores across the U.S. Target’s stores focus on convenient one-stop shopping and competitive discount prices, offering a broad range of products including beauty & household essentials (24% of [...]

September 16th, 2019|Uncategorized|

Walmart: A Dividend Aristocrat Facing Growth Challenges

Founded in 1945, Walmart (WMT) is the world’s largest retailer with more than $500 billion in annual revenue and over 11,000 stores. About half of Walmart’s stores are located in international markets, where the company has had a presence since 1991. However, the majority of Walmart’s sales and profits are derived from the company’s U.S. [...]

September 16th, 2019|Uncategorized|