Through the better part of May, when 10-year treasury bonds were yielding 1.9% (or less), even stocks with the most tepid of dividend yields were still more attractive than fixed-income investments. Now though — with 10-year notes paying out something closer to 2.6% — income-oriented investors are being forced to reconsider some of their lower-yield stocks.
Some of the companies now under a higher level of scrutiny will adjust by raising their dividends. For other stocks, the market will naturally crank up their payout by lowering the share price. For a handful of low-dividend equities, however, there’s just no getting around it — higher treasury yields are going to suppress any upside they may have had.
Here are the most vulnerable names in that bunch. Note that weak yields aren’t the only challenges these names are facing.