Blackstone (BX) announced it will convert from a publicly traded partnership to a corporation on July 1, 2019. Investors cheered the move, sending shares of BX higher by 7.5%. Let's review Blackstone's rationale for the change and what it could mean for income investors. Blackstone decided to convert from a partnership to a corporation due to tax reform, which reduced the highest corporate tax rate from 35% to 21%. While Blackstone's tax bill will increase due to this change (partnerships pass on their income tax obligations to their owners, but corporations pay income tax), management believes that incremental cost will be more than offset by the benefits of a simpler structure.

Qualcomm (QCOM) shareholders received good news yesterday: the chip maker and Apple agreed to drop all litigation, sending Qualcomm's stock surging more than 20%. In February 2019 we outlined the significant legal risks Qualcomm's core licensing business faced. I recommend skimming our note for more background on the situation, but essentially Qualcomm was accused by Apple and others of abusing its monopolistic position in wireless chips and charging excessive royalty rates. As we noted, the stakes were high.

Chevron (CVX) shares fell 5% on Friday after management announced a $33 billion deal to buy Anadarko Petroleum (APC).  As a result of this cash-and-stock acquisition, Chevron's debt load will increase and its payout ratio will rise. Let's take a closer look at why the company wants to buy Anadarko and how the transaction affects Chevron's dividend safety profile. 

Last week Walgreens (WBA) shares fell 13% and reached a five-year low after the pharmacy chain reported a big earnings miss and reduced its guidance. WBA's dividend yield also spiked above 3% to its highest level ever. Let's review why the market has turned so bearish on Walgreens to see if the company's dividend remains safe and whether or not its long-term outlook appears to remain intact.

JPMorgan Chase (JPM) is one of the world's oldest banking institutions, tracing its roots back to 1799. Today it's the largest bank in the nation, with over 5,100 branches, 16,000 ATMs, and $2.6 trillion in assets. JPMorgan operates in over 100 markets, although about 80% of its revenues are generated in the U.S. The bank has four major business segments:  Consumer & Community Banking (47% of 2018 revenue): traditional consumer and small business banking services including checking and savings accounts, small business loans, home mortgages, credit cards, auto loans, home equity loans, and personal loans. Corporate & Investment Banking (32% of revenue): helps companies raise debt and equity capital, advises on corporate strategies (turnarounds, mergers & acquisitions), provides treasury services to the U.S. [...]

Founded by Jerome Monroe Smucker in 1897, J. M. Smucker (SJM) has grown into a leading purveyor of various consumer food products and specialty pet foods that can be found in an estimated 92% of U.S. households. The company's main products are coffee, pet food, pet snacks, peanut butter, fruit spreads, shortening and oils, baking mixes and ready-to-spread frostings, frozen sandwiches, flour, juices and beverages, and portion control products. Some of Smucker's iconic brands include:

Wells Fargo (WFC) was founded in 1852 and is the fourth largest bank in the country as measured by assets. The bank ended 2018 with $1.3 trillion in total deposits, and its 90 different business lines collectively generated over $86 billion in revenue from a diversified mix of banking, insurance, investment, mortgage, and consumer and commercial finance services.Unlike many big banks, Wells Fargo has little exposure to investment banking and trading operations, which tend to be more cyclical and riskier businesses. Instead, the firm focuses on simple lending activities (mortgages, auto loans, commercial financing, etc.) and fee income.

Founded in 1928, Genuine Parts Company (GPC) is one of the largest replacement part makers in the automotive, industrial, office equipment, and electronics industries. The company markets its products in the U.S., Canada, Australia, New Zealand, and Mexico through a large network including over 100 North American auto and industrial distribution centers and over 6,700 NAPA auto parts stores worldwide. Genuine Parts Company’s sales are derived from a diverse group of well-known industry brands including NAPA auto parts, Motion Industries (industrial components), and SP Richards & Company (office products).

Founded in 1940, McDonald's (MCD) is the world's largest quick-serve restaurant chain, with about 37,000 locations in more than 100 countries. Approximately 93% of its locations are franchised, meaning the stores are owned and operated by independent business owners. The company's goal is to eventually have 95% of its stores franchised. Under a typical franchise arrangement, McDonald's owns the land and building or secures a long-term lease for the restaurant location, and the franchisee pays for equipment, signs, seating, and décor. The company believes that ownership of real estate, combined with the co-investment by franchisees, enables it to achieve restaurant performance levels that are among the highest in the industry. Franchisees are responsible for reinvesting capital in their businesses over [...]

Hormel Foods (HRL) was founded in 1891 and has proven to be one of the most resilient food providers in the world. The company’s brands include Skippy peanut butter, SPAM meat, Dinty Moore stew, Wholly Guacamole dips, Jennie-O turkey, and numerous Hormel-branded meat products. Perishable products (fresh meats, frozen items, refrigerated meals) account for 56% of Hormel's revenue, followed by poultry (19% – turkey), shelf-stable goods (19% – canned meats, peanut butter, hash, stews, chips, etc.), and miscellaneous products (6% – nutritional food products, dessert and drink mixes, etc.).