America's largest banks have come a long ways since the 2007-09 financial crisis. Based on data from the Federal Reserve, they are well capitalized and have sizable capital buffers to absorb losses from unexpected shocks. The Fed's 2019 stress test on the nation's largest banks such as Bank of America (BAC) indicated that these institutions could maintain adequate capital levels, as well as their dividends, in "severely adverse" economic conditions. However, the coronavirus pandemic is a test unlike any other as many parts of the economy have now reached a standstill. Many households and businesses simultaneously need access to capital, and fast.

America's largest banks have come a long ways since the 2007-09 financial crisis. Based on data from the Federal Reserve, they are well capitalized and have sizable capital buffers to absorb losses from unexpected shocks. The Fed's 2019 stress test on the nation's largest banks such as Wells Fargo (WFC) indicated that these institutions could maintain adequate capital levels, as well as their dividends, in "severely adverse" economic conditions. However, the coronavirus pandemic is a test unlike any other as many parts of the economy have now reached a standstill. Many households and businesses simultaneously need access to capital, and fast.

Shares of Dominion and other utilities have been dragged down with the broader market over the past month, a surprise to many since utility stocks are normally seen as safe havens during a downturn. In fact, Dominion's dividend yield spiked to 6.3% on Monday (its highest level in over a decade) and now sits at 5.6%, causing some investors to wonder whether such a high yield might indicate trouble for Dominion's dividend. As a public utility, Dominion enjoys much greater assurance of profit than most companies. Approximately 70% of the firm's earnings are generated by state-regulated utility operations, with another 25% from gas transmission and storage services backed by long-term contracts and regulated tariff rates.

Chevron (CVX) this morning announced a series of actions to preserve capital in response to the unprecedented decline in oil prices. As part of the plan, management pledged to protect the dividend: “Chevron’s financial priorities remain unchanged. Our focus is on protecting the dividend, prioritizing capital that drives long-term value, and supporting the balance sheet.” – Chevron CFO Pierre Breber As we discussed earlier this month, Chevron has a very strong balance sheet and is one of the very few companies in the energy sector to earn a Safe Dividend Safety Score.

CBS and Viacom completed their merger in December 2019 to form ViacomCBS (VIAC). The global media and entertainment company creates content and owns a variety of cable and broadcasting networks. Source: ViacomCBS Investor Presentation The coronavirus outbreak has created several headaches for ViacomCBS which seem likely to slow the company's progress in reaching its deleveraging target. As a result, we are downgrading ViacomCBS's Dividend Safety Score to Borderline Safe. A sharp slump in advertising represents the first issue facing the company. Advertising accounts for about 40% of ViacomCBS's revenue.

Paychex (PAYX) provides payroll and human resource services to small- and mid-sized businesses across a wide range of industries. The firm's operations historically generated predictable free cash flow and high margins. Even during the 2007-09 financial crisis, Paychex's payroll services segment only experienced 2-3% annual revenue declines, and its human resources division grew each year. Each year free cash flow continued covering Paychex's dividend, which management has paid without interruption for more than two decades. Paychex's businesses are driven by its number of clients and how many people its clients employ. These factors determine how many paychecks get sent out, as well as the level of HR benefits and services that can be provided.

This morning Total (TOT) announced its response to the $30 per barrel oil environment we are living in. The company plans to maintain its 35-plus year streak of uninterrupted dividends. Management took actions to slash its capital spending by nearly 20%, suspend its share repurchases, and double down on its cost-cutting programs. Source: Total Investor Presentation Together, these efforts are expected to result in cash savings of $5 billion. Total will still need to borrow around $4 billion to fill the $9 billion shortfall created by the fall in oil prices from its budgeted level of $60 per barrel.

Royal Dutch Shell (RDS.B) announced a series of initiatives this morning to improve its cash flow generation. While management did not comment specifically on the dividend, its lack of inclusion in the firm's new capital preservation measures suggests Shell intends to maintain its payout for now.

Dear customer or prospective member, Matt (my business partner) and I want to provide you with an update on how Simply Safe Dividends is responding to the impact of the coronavirus and the turmoil it has caused in financial markets.  The past several weeks have been a trying time for the U.S. and the world. Our foremost wish is health and safety for you, your families, and the brave men and women serving on the frontlines.  As we all continue grappling with what the future may hold, I wanted to address some of the investing questions you might have. 

According to the Wall Street Journal, over 38,000 stores around the U.S. have temporarily closed in response to the coronavirus outbreak.  Deemed to sell essential products, Lowe's has not. In fact, two associates we spoke to (including one in Chicago where a shelter-in-place order had gone into effect) described their stores as "slammed" and "really busy". At this point, the greatest risk to Lowe's near-term outlook appears to be the prospect of a recession, which could result in less foot traffic and fewer sales. Lowe's revenue is sensitive to consumer spending. But a recession — perhaps especially one where people are more likely to want to stay home and work around the house — seems unlikely to threaten the dividend.