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5 Dividend Disappointments So Far in 2013

Exelon, Cliffs and others made significant cuts to their payouts

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QuarterlyReviewOutlook185Generally speaking, the only worse words for shareholders than “bankruptcy” are “dividend cut.” When a company slashes its payout, it’s not necessarily a death knell, but it’s almost always an indication of a serious problem of some sort — usually centering around cash.

Just look at the banking industry, which saw dividend cuts and suspensions en masse during the financial crisis, with Bank of America (BAC) and Wells Fargo (WFC) among big financials that had to take a big ax to their payouts in 2009 (and only the latter’s dividend has recovered since then). In the auto sector, Ford (F) had to stop paying dividends altogether by 2007, and didn’t resume payouts until last year.

Still, in all three cases, the companies have survived and bounced back from their low, low points.

What will happen to the following five companies still remains to be seen, but for now, they all share a common bond in that they’ve either cut back their dividends or suspended them altogether during the first half of 2013:

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