I am as disappointed to see Bank of America’s dividend cut as anyone. The stock is one of the only financial positions in the Dividend Superstars portfolio, and I thought the company would honor its promise to keep its payout at least stable through the current crisis.
I was wrong. Circumstances — which sure include the pending MER acquisition and the ongoing credit crunch — forced a 50% reduction in the company’s dividend.
For some perspective, this marks the first year since 1978 that BAC didn’t INCREASE its payment.
The company was also the second-largest payer in the S&P 500. After the cut, it remains the 5th largest payer.
I don’t think it’s a good idea to sell the shares into weakness on the news. But I will be providing a complete update on the company, and what I recommend doing given the latest news, in the next issue of Dividend Superstars.
Related posts:
- Wells Fargo Cuts Dividend: The Final Financial to Go After U.S. Bancorp’s recent dividend cut, Wells Fargo (WFC: 30.63 0.00 0.00%) was the last major financial dividend payer left...
- Despite Dividend Cuts, You Can Find Nice Yields! According to Standard & Poor’s, the second quarter saw the greatest number of dividend cuts in 18 years. The firm...
- Quick note on Pfizer’s Dividend Announcement This week, Pfizer announced that it would not be raising its dividend for the first time in 42 years....
