Led by our founder, a CPA and former equity analyst, our scores analyze payout ratios, balance sheets, company news, and more to predict a company's dividend risk. Ratings are available to subscribers.
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0 - 20
Very Unsafe
- High risk of being cut
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21 - 40
Unsafe
- Heightened risk of being cut
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41 - 60
Borderline
- Moderate risk of being cut
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61 - 80
Safe
- Unlikely to be cut
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81 - 100
Very Safe
- Very unlikely to be cut
Our real-time track record
97% of dividend cuts caught in advance
As straight shooters, we maintain a public track record of how our ratings have performed. Since our scoring system's inception in 2015, investors who stuck with companies that scored above 60 (our Safe threshold) would have avoided 97% (825 of 844) of dividend cuts that've occurred.
The scores below reflect our rating before the cut was announced, demonstrating the predictive value of Dividend Safety Scores™.
844 dividend cuts
since inception in 2015
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20
Very Unsafe
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Apollo Commercial (ARI) lowered its dividend by 29%. The mortgage REIT's dividend was under pressure due to losses from large loans, especially those tied to struggling assets like a hospital portfolio in Massachusetts. Additionally, expected interest rate cuts were likely to lower income from its floating rate loans.
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30
Unsafe
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Hudson Pacific Properties (HPP) suspended its dividend. The office REIT had seen its occupancy rate and profits decline as the ongoing trend of remote work weighed on demand, especially in West Coast cities like San Francisco where many of Hudson's tech and media clients reside.
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30
Unsafe
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B. Riley (RILY) suspended its dividend. The small investment bank and diversified financial services company warned of new investment losses and wrote down part of its stake in a troubled U.S. retail business. B. Riley was also subject to an investigation by the Securities and Exchange Commission into whether it gave investors a realistic picture of its financial health. Shares crashed 50% on the news.
See the complete track record →
Industry expertise
Overseen by a CPA and former equity analyst
Dividend Safety Scores™ are not some black-box quant metric. Human input is the bedrock for assigning and monitoring our ratings.
Our founder, Brian Bollinger, is a CPA and former equity analyst at a multibillion-dollar investment firm. Brian has spent thousands of hours researching companies and digging into the weeds of financial statements.
In 2015, Brian developed Dividend Safety Scores™ by going through our coverage universe brick-by-brick, studying each industry and business to cement the metrics that matter most. Most of Brian's time is spent monitoring our coverage for material changes in dividend risk.
Rigorous analysis
Every stone is turned over
Dividend Safety Scores™ predict dividend risk over a full economic cycle by analyzing the most important metrics for dividends, including:
- Payout ratios
- Debt levels and coverage metrics
- Recession performance
- Dividend longevity
- Industry cyclicality
- Free cash flow generation
- Forward-looking analyst estimates
Our analysts take all of this information into account as well as the latest company news, industry developments, and key business model drivers to assign Dividend Safety Scores™ between 0 and 100.
All of the financial data we rely on is delivered to us daily by Standard & Poor's (S&P), one of the world's leading financial data vendors.
Up-to-date ratings
Quarterly reviews, continuous monitoring
We're notified internally if a company's fundamentals experience a change that could alter its dividend risk profile. We'll then dive in to investigate. We'll review the latest earnings report, skim call transcripts, and scrutinize the firm's business model to determine whether a score change is prudent.
At a minimum, all ratings are reviewed after quarterly earnings. If material news (e.g. a lawsuit) comes out between earnings, we'll initiate a review. Published review dates make it crystal clear how up-to-date a score is.
Time-tested results
Validated during the pandemic
The pandemic threw a curveball as swaths of the economy shut down and the sharpest economic contraction in U.S. history ensued. An astonishing 25% (334 out of 1,313) of companies we rated cut their dividends in 2020.
Once the pandemic hit, we worked quickly to incorporate new information into our ratings. When the dust settled, our Safe and Very Safe buckets had avoided all but 8 (or 97.6%) of the cuts in 2020.
Moreover, our scores demonstrated their long-term predictive value.
Using our pre-pandemic ratings as of January 2020 and ignoring any score changes we made as new information rolled in, 93% of the 334 dividend cuts would have still come from firms that scored below our Safe threshold.
Here's a breakdown of the 334 cuts by score bucket as of January 2020:
Here's a breakdown of the 334 cuts by score bucket as of January 2020:
| 2020 Performance | Very Unsafe | Unsafe | Borderline | Safe | Very Safe | Total |
|---|---|---|---|---|---|---|
| # of Stocks in Bucket | 187 | 179 | 330 | 320 | 297 | 1,313 |
| # of Dividend Cuts | 96 | 91 | 101 | 33 | 13 | 334 |
| % of Stocks That Cut | 51% | 51% | 31% | 10% | 4% | 25% |
For a more thorough analysis, read our full pandemic review.
Time-saving clarity
Interwoven throughout the site
At a glance, you'll be able to identify holdings with heightened dividend risk. Got a new investment idea? Vet the company in seconds by looking up its rating. Need more ideas? Screen our coverage of 1,000 rated companies.
Email notifications
Alerts keep you in the know
If we issue a change to a score in your portfolio, you'll receive an email notification along with our rationale for the change. No surprises or quantitative mumbo-jumbo. Just clear, concise research crafted by real analysts so you'll never feel in the dark.
Thorough explanations
Paired with in-depth research
More than just a number, ratings are often published alongside rigorous research reports. That way, you can make informed decisions. Many customers find as much value in our research as in our ratings.
Tailored insights
Industry nuances baked in
Our ratings recognize meaningful differences between industries. For example, a utility company enjoys more stable earnings than a steelmaker, so a utility can afford to maintain a higher payout ratio. We also utilize industry-specific metrics, such as AFFO for REITs and DCF for MLPs.
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