17 Dividend Disappointments in 2012

by Jim Woods | July 9, 2012 10:39 am

I’ve become accustomed to delivering good dividend news to InvestorPlace readers each Friday with my report on companies increasing dividends[1] in the prior week. Today, however, I’m delivering the flipside of the coin — namely, companies that have let shareholders down by decreasing and/or suspending their dividends.

Although the list isn’t long when compared to the number of blue chip companies boosting payouts[2] so far this year, quite a few rather prominent firms have decidedly disappointed on the dividend front. Here are 17 companies decreasing and/or suspending dividends in the first half of 2012.

Arch Coal (NYSE:ACI[3]) turned down its dividend furnace 72%, reducing its annual payout from 44 cents per share to 12 cents. The dividend yield, based on the May 1 closing price of $9.22 (the day the dividend cut was announced), is 1.30%.

Astoria Financial (NYSE:AF[4]) reduced its annual dividend 69% from 52 cents per share to 16 cents. The dividend yield, based on the April 18 closing price of $9.11, is 1.76%.

Cedar Shopping Centers (NYSE: CDR[5]) decreased the rent it pays shareholders by 44%, cutting its annual dividend payout from 36 cents per share to 20 cents. The REIT’s dividend yield, based on the Jan. 26 closing price of $5.19, is 3.85%.

Corporate Office Properties (NYSE:OFC[6]) is another REIT that lowered its rent to shareholders. The company cut its annual dividend payment 33% from $1.65 per share to $1.10. The dividend yield, based on the Jan. 12 closing price of $22.98, is 4.79%.

Cross Timbers Royalty Trust Units (NYSE:CRT[7]) chopped its annual dividend payout 14%, from $2.74 per share to $2.35. The new dividend yield, based on the May 21 closing price of $40.55, is 5.80%.

Dominion Resources Trust (NYSE:DOM[8]) is a natural gas firm, and the metrics in the space caused the company to reduce its annual dividend by nearly 27% from 71 cents per share to 52 cents. The new dividend yield, based on the May 21 closing price of $8.68, is 5.99%.

Hugoton Royalty Trust (NSYE:HGT[9]) is another natural gas firm that was forced to cut its payout. The company reduced its annual dividend payout nearly 15% from 74 cents per share to 63 cents. The new dividend yield, based on the May 21 closing price of $11.65, is 5.41%.

International Shipholding  (NYSE:ISH[10]) cut the fiscal cargo it delivers shareholders by 33%, taking its annual dividend payout down from $1.50 per share to $1. The new dividend yield, based on the April 26 closing price of $21.75, is 4.60%.

KB Home (NYSE:KBH[11]) was a dividend darling during the housing boom, but this year it’s been forced to nearly foreclose on shareholders. The company slashed its annual dividend payout 60%, from 25 cents per share to 10 cents. The new dividend yield, based on the April 13 closing stock price of $8.05, is 1.24%.

Mesa Royalty Trust (NYSE:MTR[12]) is another energy firm that turned down the heat on shareholders. The company cut its annual dividend payout nearly 35% from $2.07 per share to $1.35. The new dividend yield, based on the May 22 closing price of $30.50, is 4.43%.

NGP Capital Resources (NASDAQ:NGPC[13]) reduced the capital it hands back to shareholders by 33%, cutting its annual dividend payout from 72 cents per share to 48 cents. The new dividend yield, based on the March 22 closing price of $6.69, is 7.17%.

Noble (NYSE:NE[14]) is a big energy company that made a big adjustment to the power of its dividend. The company reduced its annual dividend 14.8%, from 61 cents per share to 52 cents. The new dividend yield, based on the Feb. 3 closing price of $36.9, is 1.41%.

Roma Financial (NASDAQ:ROMA[15]) is a regional bank that operates in New Jersey, but shareholders in the Garden State bank had to sustain a 50% cut in their annual dividend from 32 cents per share to 16 cents. The new dividend yield, based on the June 22 closing price of $8.93, is 1.79%.

San Juan Basin Royalty Trust (NSYE:SJT[16]) is yet another natural gas play gone south. The company cut its annual dividend payout to shareholders 16%, from 99 cents per share to 83 cents. The new dividend yield, based on May 21 closing price of $17.37, is 4.78%.

Value Line (NASD:VALU[17]) is an investment data publisher, and this year it had to publish a 25% reduction in its annual dividend payout from 80 cents per share to 60 cents. The new dividend yield, based on Jan. 19 closing price of $10.59, is 5.67%.

In addition to the companies decreasing dividends this year, two prominent companies suspended their dividend. On March 21, snack food maker Diamond Foods (NASDAQ:DMND[18]) halted its payout. Later, the company failed to meet a deadline to restate its financial results after an investigation uncovered improper accounting practices. Diamond now faces the possibility of a delisting from the Nasdaq.

On May 15, discount retailer J.C. Penney (NYSE:JCP[19]) also suspended its dividend. The company’s rebranding effort, along with a new management team, has had a rough go of things this year, and the suspension of its dividend represents a big black mark on its fiscal fitness.

At the time of publication, Jim Woods held no positions in any of the stocks mentioned in this article.

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