Analyst ratings in March for dividend stocks are off to a slow start. I consider a stock with a yield of 2% or more to be a true dividend stock. Anything less than that is not worth analyzing as a dividend payer.
We’ve had only 4 dividend stocks receive analyst upgrades so far in March while 9 have received downgrades. Here is a brief overview of what the analysts are saying.
Upgrades
Main Street Capital Corp – MAIN was upgraded by Robert W. Baird on March 11th from Neutral to Outperform with a new $36 price target. MAIN is has a yield of over 6% and a 5 year dividend growth rate of 31%.
Time Warner Inc – TWX was upgraded by Argus to Buy. The upgrade appears to be based on Valuation but its not easy to tell. TWX announced that it will spin off Time magazine this week. It has a dividend yield of 2%.
Pembina Pipeline Corp – PBA was upgraded by RBC Capital Markets to Outperform. They set their price target to $35 a share but the reason for the upgrade was not available. PBA has a dividend yield of 5%.
Seadrill Ltd – SDRL HSBC Securities upgraded Seadrill to Overweight on March 5th. SDRL has a dividend yield of 11% and has increased its dividend for 3 consecutive years.
Downgrades
Cablevision Systems – CVC: Wunderlich downgraded CVC to a Hold on March 1st and set a price target of $15 per share. They based the downgrade on the AOCF Fallout from Hurricane Sandy. CVC has a dividend yield of 4.2%.
Cliffs Natural Resources – CLF: BMO Capital Markets downgraded CLF to Market Perform on March 5th and set a $27 price target. Their reason was listed as poor cash position and recent dividend cuts. I don’t know about you but that is not something I’d want to own.
Texas Roadhouse – TXRH: Miller Tabak said to Hold TXRH based on margin expansion reflected in valuation and did not list a price target. TXRH has a yield of 2.4%
CommonWealth REIT – CWH: Stifel advised its listeners to sell this REIT based on risk from the current battle against activists. CWH has a yield of 4.5%.
Tiffany & Co – TIF: Canaccord Genuity said TIF was a sell and set a price target at $52 per share because they believe the current fundamentals do not support the current stock price.
Kroger – KR: Hilliard Lyons said that Kroger was no longer a buy but was now a long-term Buy becuase of the short term valuation. KR is up 18% in 2013 and has a dividend yield of 2%.
