The dividend downgrades slowed down last week compared to previous weeks where investment firms had been more aggressive with their downgrades. Only 7 dividend stocks with yields of 2% or more were downgraded to Hold. One was downgraded to Sell. We have listed the reason for the downgrade and the new price target when it was made available by the analyst.
Vornado Realty Trust (VNO)
Vornado Realty Trust is a REIT that was downgraded by UBS from Buy to Neutral on March 5th, with a price target of $85 per share. UBS cited a lack of near-term catalysts as well as what it called an "overly complicated story" as the reason for the downgrade. VNO was also downgraded by Argus from a Buy to a Hold on March 8th. VNO has a dividend yield of 3.4% and has increased its dividend for 2 years since it cut its dividend back in 2009.
CH Energy (CHG)
CH Energy was downgraded by Brean Murray from a Buy to a Hold on March 5th. Brean Murray said the downgrade was based on valuation following the $65 per share offer from Fortis to acquire the company. CHG has a dividend yield of 3.3% and a payout ratio of 80%. The company increased its dividend in 2011 after keeping it at $2.16 per share for many years.
Greif was downgraded by Deutsche Bank on March 5th from a Buy to a Hold, with a price target of $52 per share. Deutsche Bank said the downgrade was based on weakness in European demand and valuation. Greif has a dividend yield of 3.3% and has a payout ratio of 62%. It has a 5 year dividend growth rate of 22% and has increased its dividend for 8 years.
Nutrisystem was downgraded by Auriga from a Buy to a Hold on March 6th, with a price target of $11 per share. Auriga said the downgrade was largely based on the company's fourth quarter results and 2012 outlook. Nutrisystem has a dividend yield of 6.6%, but has not increased its dividend since its started paying dividends in 2008. NTRI is down 18% year to date.
Medtronic was downgraded by Argus from a Hold to a Sell on March 9th. Argus said the downgraded was based on concerns regarding slowing sales growth driven by secular factors. MDT has a dividend yield of 2.5%, which is above its 5 year yield average of 2.1%. The company has increased its dividend for 34 years. It has a 5 year dividend growth rate of 18% and a payout ratio of 31%.
Raytheon (RTN) was downgraded by Standpoint Research on March 5th from a Buy to a Hold. The reason for the downgrade was not made available. Raytheon has a dividend yield of 3.3% with a 5 year dividend growth rate of 12% and a payout ratio of 33%.
CenterPoint (CNP) was downgraded by RBC Capital Markets from Outperform to Sector Perform and a new price target was set of $20 per share. CenterPoint has a dividend yield of 4.1% and a 5 year dividend growth rate of 5.1%. It has a payout ratio of 44%.