Beware of These 10 Next Dividend Cutters [Podcast]

September 13, 2023

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About 18 months ago, after some interest rate increases, we raised our red flag on some companies that seemed in trouble. Today, we’ll go back to them to see if we were right or wrong and why. Then, we’ll share more businesses that may cut their dividend in the next 12 months. Make sure the one giving you headaches is not on the list, and know how to identify them in the future!

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Mike explains the three red flags he looks at to identify potential dividend cutters.
Last time, Omega Healthcare (OHI) was flagged as having a high chances of cutting its dividends. About a year and a half later, OHI didn’t cut its dividend, but the replacement we suggested, Medical Properties (MPW), did! Mike goes back to what happened and how things can go fast!
Does it mean OHI is out of trouble? Mike is not so sure…
True North Commercial REIT (TNT.UN.TO) was also tagged in 2022. This time, Mike was right; TNT cut its dividend. We then named Allied Properties, Smart Centres, CT REIT, and Canadian NET REIT as better options. As REITs are having a hard time, do these options still hold?
Let’s move to Chartwell Retirement Residences (CSH.UN.TO) and Choice Properties (CHP.UN.TO). The first one didn’t cut its dividend but didn’t increase it. The second rewarded shareholders with a slight increase. Are they still among the next dividend cutters?
Mike and Vero discuss the next dividend cutters. In the REIT sector, Innovative Industrial Partners (IIPR) and North West Properties (NWH.UN.TO) are facing challenges. What makes Mike think they will cut their dividends?
REITs are greatly affected by higher interest rates because they often show a high debt level. How could listeners choose suitable replacements in this sector?
Mike is worried about Western Union (WU) in the financial sector because of its business model. Other options could easily replace it.
Mike is raising the flag for Westlake Chemical Partners (WLKP) and Transcontinental (TCL.B.TO) and pulls out several replacements: Air Product and Chemical (APD), CCL Industries (CCL.B.TO), Nutrien (NTR), and Stella-Jones (SJ.TO).
Let’s end with one company in the Consumer Discretionary and one in the Consumer Staples: Foot Locker (FL) and Andrew Peller (ADW.A.TO). Their lack of growth puts them at risk of cutting their dividends.