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Most of the downgrades we have seen for dividend-paying stocks in 2012 are from a buy to a hold rating. Many of these stocks are reaching what analysts consider to be fair value and are no longer attractive to investment firms. We found 8 dividend stocks with yields over 2% that have been downgraded so far in May. We've listed the reason for the downgrade and the new price target when it was made available by the analyst.

Apollo Commercial Real Estate (NYSE:ARI)

Apollo was downgraded by Stifel Nicolaus from a Buy to a Hold on May 1st. Stifel Nicolaus said the downgrade was based on valuation and the maturing CMBS portfolio that will make the yield difficult to maintain. ARI has a dividend yield of 10.2%. ARI is a REIT so we are not focused on the payout ratio. The company has not increased its dividend since 2010.

Archer Daniels Midland (NYSE:ADM)

Archer Daniels was downgraded by Standpoint Research from a Buy to a Hold on May 1st. Standpoint said that they expect ADM to move above its 52 week high of $37 next year but believe it is currently trading a fair value despite its low P/E. ADM has a dividend yield of 2.1% and a payout ratio of 21%. The company has increased its dividend for 37 years and has a 3 year dividend growth rate of 8.1%.

Flowers Foods Inc (NYSE:FLO)

Flowers Foods was downgraded by Longbow from a Buy to a Neutral on May 1st. Longbow said the downgraded was based on increased competition that will pressure earnings. FLO has a dividend yield of 3% and a payout ratio of 67%. The company has increased its dividend for 9 years and has a 3 year dividend growth rate of 14.4%.

BRE Properties Inc (NYSE:BRE)

BRE was downgraded by Wunderlich from a Buy to a Hold on May 2nd with a price target of $55 per share. Wunderlich believes BRE has reached fair value and said that it trades at a premium to its peers. BRE has a dividend yield of 2.9%. It is a REIT so we are not focused on the payout ratio. The company just recently increased its dividend for 2012.

Other Dividend Stock Downgrades

The following stocks were downgraded last week but the reason for the downgrade was not made available by the investment firm.

Harris Corp (NYSE:HRS) was downgraded by Needham from a Buy to a Hold rating on May 1st. HRS has a dividend yield of 2.8% and a payout ratio well above 100%. The company has increased its dividend for 10 consecutive years.

Air Products and Chemicals Inc (NYSE:APD) was downgraded by Argus from a Buy to a Hold on May 1st with no price target provided. APD has a dividend yield of 2.8% and a payout ratio of 43%. The company has increased its dividend for 29 years and has a 3 year dividend growth rate of 10.5%.

Chesapeake Energy Corp (NYSE:CHK) was downgraded by Robert W. Baird and Ladenburg Thalmann to Neutral with a price target of $22 on May 2nd. CHK has a dividend yield of 2% and a payout ratio of 15. The company has increased its dividend for 1 year and has a 3 year dividend growth rate of 5.5%.

Axis Capital Holdings (NYSE:AXS) was downgraded by Deutsche Bank from a Buy to a Hold with a price target of $36. AXS has a dividend yield of 2.7% and a payout ratio of 25%. The company has increased its dividend for 8 consecutive years and has a 3 year dividend growth rate of 6.8%.

Source: 8 Dividend Stocks Analysts Are Holding