Philip Morris (PM) reported earnings on April 21 and reiterated the firm's commitment to its dividend during these uncertain times: We also expect that strong cash flows will exceed cash requirements, including the funding of dividends to which we remain fully committed...Crucially, our organization, liquidity, and balance sheet are strong. We'll continue to protect and support our employees, serve our consumers, and reward our shareholders, which clearly includes our strong commitment to a dividend. The international maker of Marlboro cigarettes and IQOS heated tobacco products expects to remain relatively resilient overall during the pandemic. 

Earlier this month Raytheon completed its all-stock merger with United Technologies, forming Raytheon Technologies (RTX). Several weeks before the merger closed, United Technologies executed the spin-offs of its Otis (OTIS) elevators and Carrier (CARR) building systems businesses. United Technologies stock remained outstanding but the company changed its name to Raytheon Technologies and its ticker symbol to RTX. Since Raytheon Technologies has not yet reported financial results, please note that the financial data shown on our website (and most others) reflects United Technologies' past information, including its dividend.

The outlook for retail REITs continues to dim as the coronavirus pandemic drags on and fewer businesses are able to pay rent. Nareit, a producer of REIT research, recently conducted a survey of 54 publicly-listed REITs and found that shopping center REITs have only collected 46% of their rent this month as of mid-April. Rent collection rates will vary significantly between retail REITs depending on their mix of tenants and property locations, but Kimco's (KIM) exposure is concerning. Kimco generates approximately 78% of its annual base rent from grocery-anchored shopping centers and has historically focused on service-based tenants, which face less pressure from e-commerce.

Earlier today, Standard & Poor's lowered Walt Disney's (DIS) credit rating from A to A- and maintained a negative outlook on the firm's rating. Given the rising credit rating pressure facing Disney, management's desire to maintain a mid-single A leverage profile, and the increased likelihood of theme park profitability remaining weak for longer, we are downgrading the company's Dividend Safety Score from Borderline Safe to Unsafe. As we discussed in our April 5 note, almost all of Disney's businesses are under pressure due to the COVID-19 pandemic, reducing its ability to pay down debt following its $71 billion acquisition of 21st Century Fox in 2019. Disney's theme parks (38% of sales) remain closed indefinitely. Its TV and film studios (16%) can't complete production or [...]