Unexpectedly Intriguing!
03 November 2015

Following up our post from 2 November 2015, in which we noted that the number of U.S. firms announcing dividend cuts had crossed into contractionary territory where the relative health of the U.S. economy is concerned, we'll look next at Standard and Poor's count of the number of dividend cutting firms for the month of October 2015, in the context of all the data they've reported monthly since January 2004.

Monthly Number of U.S. Publicly-Traded Companies Announcing Dividend Cuts, January 2004 through October 2015

The last time that the U.S. stock market had fewer than 10 firms announcing dividend cuts in a single month, a level that we've previously observed seems to mark the threshold between a healthy and growing U.S. economy and an economy experiencing recessionary conditions, was two years ago, in October 2013. Since that time, it appears that the general trend has been one that suggests a growing level of economic distress.

In October 2015, S&P counted 22 U.S. firms that announced dividend cuts. Using our two alternate sources for reported dividend cut announcements, Seeking Alpha's Market Currents (filtered for dividends) and the WSJ's Dividend Declarations database, we came up with a total of 25, after excluding investment funds that were likely negatively impacted by their holdings of the stocks of companies that actually did cut their dividends (symbols ASG and APO). After accounting for these firms, we're within one of the total reported by S&P.

Our tally is presented in the table below (click here to access the table as it appears properly formatted on our site). We find that oil and mining firms are the most heavily represented, followed by financial firms. Follow the links in the table to the original reports of the indicated firm's dividend cut announcement.

Publicly Traded U.S. Companies Cutting Dividends in October 2015
Date Company Symbol Old Dividends per Share New Dividends per Share Percent Change
6-Oct-2015 Sabine Royalty Tr UBI SBR $0.35285 $0.19259 -45.4%
14-Oct-2015 Nordic American Tankers NAT $0.40000 $0.38000 -5.0%
15-Oct-2015 Nordic American Offshore NAO $0.17000 $0.15000 -11.8%
15-Oct-2015 Alamos Gold AGI $0.03000 $0.01000 -66.7%
16-Oct-2015 Blackstone Group BX $0.72598 $0.49000 -32.5%
19-Oct-2015 Liberty All-Star Growth Fund ASG $0.12000 $0.11000 -8.3%
20-Oct-2015 Enduro Royalty Trust NDRO $0.05558 $0.04236 -23.8%
20-Oct-2015 San Juan Basin Royalty Trust SJT $0.05285 $0.03712 -29.8%
21-Oct-2015 Permian Basin PBT $0.03046 $0.01928 -36.7%
21-Oct-2015 VOC Energy Trust VOC $0.11000 $0.10000 -9.1%
22-Oct-2015 Natural Resource Partners NRP $0.09000 $0.04500 -50.0%
23-Oct-2015 AllianceBernstein AB $0.48000 $0.43000 -10.4%
23-Oct-2015 Noble Corp NE $0.37500 $0.15000 -60.0%
26-Oct-2015 Legacy Reserves LGCY $0.35000 $0.15000 -57.1%
27-Oct-2015 Memorial Production Partners MEMP $0.55000 $0.30000 -45.5%
27-Oct-2015 MKS Instruments MKSI $0.17000 $0.16500 -2.9%
28-Oct-2015 North European Oil Royalty Trust NRT $0.36000 $0.23000 -36.1%
29-Oct-2015 Marathon Oil MRO $0.21000 $0.05000 -76.2%
29-Oct-2015 Apollo Global Mgmt A APO $0.42000 $0.35000 -16.7%
29-Oct-2015 Carlyle Group CG $0.89000 $0.56000 -37.1%
29-Oct-2015 KKR KKR $0.42000 $0.35000 -16.7%
30-Oct-2015 Foresight Energy FELP $0.38000 $0.17000 -55.3%
30-Oct-2015 Oaktree Capital Group OAK $0.50000 $0.40000 -20.0%
30-Oct-2015 SandRidge Miss Tr II SDR $0.25100 $0.22300 -11.2%
30-Oct-2015 SandRidge Permian Trust PER $0.42300 $0.25000 -40.9%

Based on these observations, we find that the highest level of economic distress currently in the U.S. economy is concentrated in its oil and mining sectors.

Data Sources

Standard & Poor. Monthly Dividend Action Report. [Excel Spreadsheet]. Accessed 30 October 2015.

Seeking Alpha Market Currents. Filtered for Dividends. [Online Database]. Accessed 30 October 2015.

Wall Street Journal. Dividend Declarations. [Online Database]. Accessed 30 October 2015.

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