Earnings season is upon us. While 82% of companies have managed to beat Wall Street's expectations a few have managed to disappoint. We found 5 dividend stocks with a dividend yield of 2% or more that were recently downgraded. We have listed the reason for the downgrade and the new price target when the investment firm made it available.
CSX Corporation (CSX)
CSX was downgraded by Argus from a Buy to a Hold on April 17th. Argus expects weakness in coal carloads to persist and lowered CSX estimates to reflect lower demand. CSX has a dividend yield of 2.2% and a payout ratio of 27%. The company has increased its dividend for 7 consecutive years and has a 5-year dividend growth rate of 31%.
Whirlpool was downgraded by KeyBanc Capital Markets from a Buy to a Hold on April 18th. KeyBanc said the downgrade was based on valuation over the short term following the recent negative ruling on refrigerators that removes tariffs. KeyBanc also said that Whirlpool's lower estimates are in line with the Street. WHR has a dividend yield of 3.1% and a payout ratio of 40%. The company started paying dividends in 1929 and has increased its dividend for 1 year. It has a 5-year dividend growth rate of 3.2%.
Iberia Bank was downgraded by Stifel Nicolaus from a Buy to a Hold on April 19th. Stifel Nicolaus based the downgrade on the Q1 earnings and revised EPS estimates. The analysts is expecting continued margin pressure, lower levels of fee income, and elevated operating expenses, as were seen in this quarter's results. IberiaBank was also downgraded by Wunderlich on April 19th. IBKC has a dividend yield of 2.7% and a payout ratio of 73%. The company has not increased its dividend since 2008.
Other Dividend Stock Downgrades
Two other dividend stocks were downgraded, but the reason for the downgrade was not available.
Cypress Semiconductor (CY) was downgraded by Capstone Investments from a Buy to a Hold on April 19th. CY has a dividend yield of 2.5% and a payout ratio of 42%. The company just started paying dividends in 2011 and has increased its dividend so far in 2012.
National Penn (NPBC) was downgraded by Boenning & Scattergood from Outperform to Neutral on April 19th. NPBC has a dividend yield of 3.1% and a payout ratio of 50%. The company made a drastic cut to its dividend in 2010 and has since resumed its increases.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.