March 2018 saw the second-largest ever number of dividend cuts be declared by U.S. firms and funds in a single month. The month's 92 dividend cuts reported was just one shy of the record 93 cuts that were recorded during the Great Dividend Raid of 2012, when the very real threat of greatly higher taxes on dividends taking effect in 2013 prompted U.S. firms to drain money from the accounts they had set up to pay dividends in 2013 to instead pay out before the end of 2012 to avoid a major income tax hit.
At least, assuming that Standard and Poor's currently reported dividend data for March 2018 holds and isn't revised, which is something that we've seen before. Until we can confirm that number however, we're looking to our near-real time samples of dividend cut data to get more insight into what's going on with the dividend cut numbers for March 2018, which we'll follow up in the very near future.
Until then, here's the overall view showing the total number of announced dividend increases and decreases for each month from January 2004 through March 2018.
And because it is especially relevant, here's our chart that zooms in on just the number of dividend cuts reported over the same period of time, where we've tentatively included March 2018's spike in dividend cuts in with the 2017-2018 "tax cut and rate hike spike".
Here are the dividend numbers as we know them for March 2018 today:
- There were 4,392 U.S. firms that issued some kind of declaration regarding their dividends in March 2018, which is up significantly from February 2018's 3,493 and the year-ago March 2017's 4,041. This figure is also the third highest number on record, coming behind December 2017's 4,506 and December 2015's 4,422.
- In March 2018, there were 36 U.S. firms that announced that they would pay an extra, or special, dividend. That figure is slightly down from the 38 firms that made similar declarations in both February 2018 and back in March 2017.
- 167 U.S. companies declared that they would increase their dividends in March 2018, which is down from 322 in February 2018, but up significantly from the 141 that boosted their dividends in March 2017. For the first quarter of 2018, a total of 807 dividend rises were recorded, which ranks third for any quarter's total of dividend increases, behind March 2014's 819 and March 2015's 812.
- The 92 dividend cuts reported for March 2018 is up substantially from the 20 that were recorded in February 2018 and also from the 76 recorded back in March 2017, when the distress in the U.S. oil and gas industry was bottoming.
- 9 U.S. firm omitted paying dividends in March 2018, the same as in February 2018, but which is up from the 2 firms that did a year earlier in March 2017.
We'll follow up soon with what we find in our sampling of dividend cuts. In the event that S&P revises the dividend cut number, we'll update this post on our site, so if you're reading this on a site that republishes our RSS news feed, please make a note of the link to the original article.
Update 1 May 2018: For the record, we were able to identify the following sample of dividend cutting firms from March 2018 from our near real-time sources for dividend declarations, which at 13, is far short of the total 92 dividend cutting firms indicated by Standard and Poor for the entire U.S. stock market for the month. Here's the list (presented in chronological order according to date of dividend declaration):
- Park Hotels&Resorts (NYSE: PK)
- Colony NorthStar (NYSE: CLNS)
- CYS Investments (NYSE: CYS)
- IDT Corporation (NYSE: IDT)
- National CineMedia (NYSE: NCMI)
- Alcentra Capital (NASDAQ: ABDC)
- Capstead Mortgage (NYSE: CMO)
- Foresight Energy (NYSE: FELP)
- Cross Timbers Royalty Trust (NYSE: CRT)
- Five Oaks Investment (NYSE: OAKS)
- San Juan Basin Royalty Trust (NYSE: SJT)
- Navios Maritime Acquisition (NYSE: NAP)
- Sunstone Hotel (NYSE: SHO)
Data Sources
Standard and Poor. S&P Market Attributes Web File. [Excel Spreadsheet]. Accessed 3 April 2018.
Seeking Alpha Market Currents. Filtered for Dividends. [Online Database]. Accessed 3 April 2018.
Wall Street Journal. Dividend Declarations. [Online Database]. Accessed Accessed 3 April 2018.
Labels: dividends, stock market
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