BT (BT) has had an Unsafe Dividend Safety Score since early 2018. The British telecom giant has since seen its stock price fall more than 30%, pushing its dividend yield above 8%. In March 2019 we published an in-depth note reviewing why BT's dividend could eventually be cut. The crux of the argument lies in BT's need for greater financial flexibility.  In recent years the provider of broadband and mobile services has experienced low single-digit declines in organic revenue and EBITDA, driven by intense competition, a challenging regulatory environment, and underinvestment in its network. (Note that BT's sales growth jump in 2017 was driven by the firm's acquisition of the U.K.'s largest mobile operator.)

When I reviewed Kroger (KR) in May 2018, I made the following concluding remarks:  At the end of the day, it's hard to pull the trigger to invest in a supermarket chain. While Kroger has rewarded shareholders with tremendous returns over the last decade, profitable growth is likely to be more challenging over the next 10 years due to increased competition, stagnant new store growth, and evolving consumer shopping preferences.Kroger seems like more of a mature, defensive cash cow, but its low dividend yield does not reflect that status. For now, investors may be better off invested in other quality dividend stocks that have greater pricing power, healthier balance sheets, stronger moats, faster dividend growth profiles, and numerous opportunities to increase [...]

Pfizer (PFE) has taken steps in recent years to focus its business on higher-margin, faster-growing prescription drugs. For example, in 2013 the company spun off its animal health business, late last year Pfizer reached a deal with GlaxoSmithKline (GSK) to combine their consumer health businesses, and in June 2019 the firm agreed to buy cancer treatment firm Array BioPharma for $10.6 billion. Pfizer's evolution took its biggest step forward this past weekend when management announced plans to combine its off-patent established medicines with generic drugmaker Mylan (MYL), creating a new global pharmaceutical company with nearly $20 billion in revenue. This deal has important implications for dividend investors.

Earlier this week V.F. Corp (VFC) declared a quarterly dividend of $0.43 per share. The company's prior quarterly dividend rate was $0.51 per share, resulting in some headlines claiming that this dividend aristocrat had cut its payout. While V.F. Corp's new dividend rate is technically lower, investors didn't actually receive a payout cut. In May, V.F. Corp spun off its jeans business into an independent, publicly traded company called Kontoor Brands (KTB). VFC investors received shares in Kontoor, which also pays a dividend. As management had previously communicated when the separation was first announced, the combined dividends from V.F. Corp and Kontoor equal the dividend V.F. Corp paid prior to the spinoff.