Dividend Cuts Hit $22.5 Billion in 3rd Quarter

Dividend Cuts Hit $22.5 Billion in 3rd Quarter
Standard & Poors press release

SmartStops comment: Investors in high dividend stocks often believe that they can ride the market up and down with little concern over declines in the stock prices .(As brokers used to joke in down markets- the yields are simply going up.) But what if the dividends that help protect the stock prices start getting cut? Based on the current news in this article, even dividend investors might benefit from the protection provided by SmartStops.

Excerpt from article: New York, October 3, 2008 - Standard & Poor’s, the world’s leading index provider, announced today that 138 of the approximately 7,000 publicly owned companies that report dividend information to Standard & Poor’s Dividend Record decreased their dividend during the third quarter of 2008, representing a 557% increase from the 21 issues that decreased their dividend during the third quarter of 2007. Reported dividend increases fell 21.2% to 346 from 439 reported in the third quarter of 2007.
“It was the worst September for dividends since we started keeping dividend records in 1956,” says Howard Silverblatt, Senior Index Analyst at Standard & Poor’s. “During the second quarter, companies were nervous and cautious. The third quarter, however, saw many companies deciding to take action, and that action took $22.5 billion out of the pockets of investors.”

Link to article: