On April 8, MSC Industrial (MSM) reported earnings that were better than feared and voiced support for the dividend. Here's what Treasurer John Chironna said on the conference call:  Turning to our ordinary dividend. We have ample liquidity to continue running the business and paying the current level of our dividend in all but the most severe scenarios. We have conducted numerous best and worst-case sensitivity analyses and revenues would have to decline somewhere in the range of 40% to 50% before our operating cash flow turn negative. At these levels, we would take additional cost down actions and could sustain multiple quarters given our liquidity position. As a distributor, MSC can generate a lot of cash in a downturn because it can reduce [...]

On April 7, AT&T (T) provided a brief financial update on its business in light of the coronavirus pandemic. Management reiterated their confidence in AT&T's dividend, issuing the following statement: As it has for the past 36 years, the company looks forward to continuing to pay a quarterly dividend to shareholders. On March 27, the Board of Directors declared a dividend payable on May 1, 2020, to stockholders of record of its common and preferred shares at the close of business on April 9, 2020. AT&T also noted that it had about $12 billion in cash on hand at the end of 2019 and has a $15 billion revolver in place, though it doesn't need or plan to use it in 2020.

Urstadt Biddle Properties (UBA) owns over 80 neighborhood and community shopping centers located in the suburbs surrounding New York City. The small-cap REIT has paid uninterrupted dividends since its founding in 1969 and increased its dividend for 26 consecutive years. However, the coronavirus pandemic poses arguably the biggest challenge Urstadt Biddle has ever faced, creating an unusual amount of uncertainty for the firm.

Exxon Mobil (XOM) announced today plans to reduce its capital expenditures by 30%, slash cash operating expenses by 15%, and lean on its balance sheet to preserve the dividend. The company's CEO Darren Woods explained his perspective on the dividend during his interview with CNBC: A lot of our shareholders are retail shareholders, people who depend on that dividend. So we've been pretty committed to maintaining that and, if necessary, in the short term using the balance sheet to support it. But primarily that balance sheet is to support the investments in these industry-advantaged projects. That is the focus – to maintain a very strong foundation for the future. On March 12, we published a note reviewing several dividend coverage scenarios for Exxon in light of [...]

As we discussed in our November 2019 note, Ryder (R) wasn't firing on all cylinders prior to the coronavirus pandemic. The company's largest segment, Fleet Management Solutions (61% of revenue), provides vehicles, maintenance, and related services to businesses that need a fleet of trucks to move products to their customers. About two thirds of the segment's revenue is from contractual lease agreements with an average term of around 6 years.

Genuine Parts (GPC) distributes automotive parts (57% of sales), industrial parts (34%), and business products (9%). While these segments are each classified as "essential" businesses and have remained open, the coronavirus pandemic has significantly affected the market conditions across Genuine Parts' operations. Fewer miles are being driven (reduces auto repairs), cyclical industries (oil & gas, mining, etc.) are slowing their activity, and businesses are pulling back on purchases of office furniture and supplies. On April 6, management provided a business update and reassured income investors that this dividend king would continue providing reliable dividends despite this unprecedented environment:

Over the weekend, JPMorgan Chase (JPM) Chairman and CEO Jamie Dimon published his annual letter to shareholders. Mr. Dimon laid out the bank's response to the coronavirus pandemic and did his best to set expectations for the firm's future financial performance, including JPMorgan's dividend. First, Mr. Dimon said he expects a "bad recession" with financial stress that will at least be similar to the 2008 financial crisis. Most large banks including JPMorgan have already suspended their share repurchases to begin preserving capital. Households and businesses have an unprecedented need for credit since many of them have seen their cash flow disappear almost overnight. 

On March 12, we downgraded Walt Disney's (DIS) Dividend Safety Score from Very Safe to Safe.  We believed the coronavirus could threaten Disney's credit rating and increase pressure on management to pay down debt as cash flow slumped across Disney's theme parks and studio films. As we discussed, the coronavirus-related demand shock came at a less than ideal time as only a year ago Disney closed its $71 billion acquisition of 21st Century Fox, doubling its leverage in the process. Although only a few weeks have passed since our last note and Disney's stock price has actually increased slightly since then, a lot has changed:

On March 20, we published a note on Magellan Midstream Partners (MMP) and maintained our Safe rating after concluding that the firm appeared "to have the balance sheet, distribution coverage, and commitment to its payout to wait out better times." Less than a week later on March 26, Magellan said it was indeed maintaining its distribution guidance for the year, which even calls for a 3% increase. Like most midstream businesses, Magellan is feeling the effects of the coronavirus and the crash in oil prices. Please see our March note for more background on these issues and how they impact the firm.

On April 2, Toronto-Dominion (TD) hosted its annual shareholder meeting (by webcast only).  When asked about the safety of the bank's dividend, TD's CEO Bharat Masrani said there are no plans to change the dividend policy at this time: "We entered this period with considerable strength and strong capital position, and we are in a position, we continue to be in a position, to support the recovery that will follow this crisis we have. I can also tell you that we have no plans to change our dividend policy at this time. We have a strong -- long track record of maintaining a payout to our shareholders, including through the financial crisis, I might add. So as I said, we have no [...]