Investors have a lot to cheer about these days. The bull market is now six years old, the major stock market averages have hit new all-time highs, and most major companies seem to be raising their dividends year after year. That is the case for most companies, but certainly not all. In fact, some major outfits have been forced to lower their dividends.

What 24/7 Wall St. wants to point out about companies and outfits punishing their shareholders is that they are not just companies tied to the oil and gas sector, and not just tied to troubled trends in coal. Some industries like gold and silver have been under pricing pressure for some time. Master limited partnerships (MLPs), financial companies and real estate investment trusts (REITs) are under review here as well.

All in all, we have 13 reviews of recently lowered dividends or distributions for investors to consider. It is actually more than 13 companies and business entities due to some being reviewed are tied to each other.

Most investors only want to see higher dividends through time. If not higher dividends, at least stable dividends are preferred. The initial thought of companies cutting their dividends is that they are in dire straits. The reality is that not all dividend cuts are treated badly when they get announced. Some companies even oddly get rewarded by investors on the news, because it may stave off a capital bleed or help stabilize the company’s finances.

The reality is that some of these outfits may turn out to be fine through time. Others may still have very questionable futures for their investors. Many investors consider dividend payments a key part of corporate governance and corporate performance.

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In REITs and financials, we have dividend cuts from American Realty Capital, ARMOUR Residential, Campus Crest Communities and Prospect Capital. Dividend and distribution cuts reviewed tied to oil and gas were in Transocean, SeaDrill, Linn and Civeo. We had Peabody Energy in coal, as well as Cliffs. These are 13 lower dividends that investors should consider regarding the actual companies and their peers for industry trends ahead.

ARCP and the ABCs of Dividend Woes

American Realty Capital Properties Inc. (NASDAQ: ARCP) has had its share of negative press and negative developments. The good news is that outside investors and activist investors have gotten involved. That may signal that an implosion is not in the cards. On December 24, ARCP said that it will not pay a dividend on its common stock until its financial statements have been delivered — and then that it would pay a common stock dividend in line with its industry peers. Its old dividend would yield close to 10.5%, so that likely will be more conservative when the dividend ultimately comes back.

ARCP had made its decision after an evaluation of its portfolio properties, and the company had also obtained additional lender waivers and extensions for financial reporting at the time. With shares close to $9.50 as of late, the 52-week range is $7.38 to $14.96 and the market cap is still north of $8.6 billion. Of the few analysts that follow ARCP, all expect positive earnings for 2015, despite the woes that have been seen.

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ARMOUR MBS REIT Dividend Not Bulletproof

ARMOUR Residential REIT Inc. (NYSE: ARR) lowered its dividend with an announcement in December, and it took effect in January of 2015. The monthly payouts went to $0.04 per share from $0.05 per share. This is one of the high-yield mortgage-backed securities (MBS) REITs out there, and even with a share price of $3.17 it is worth over $1.1 billion in market cap. Before fretting here, the current yield of the monthly payouts still offers investors a 15% or so yield. This MBS REIT sector is prone to wide changes in dividends, mainly because they have to pay out effectively all of their earnings — and those earnings can fluctuate wildly throughout the business cycles and interest rate cycles. ARMOUR’s chart, which is not price-adjusted, shows that its shares have been more than cut in half since the start of 2013, back when its dividend payments were even higher.

ARMOUR may have not performed well lately, but at least a large portion of this dividend trend here is a blame for the MBS REIT sector as a whole. Annaly Capital Management Inc. (NYSE: NLY) is considered among the best in show of MBS REITS, and its dividend payments are less than half of when the dividend peaked back in 2009.

Campus Crest REIT Dividend Feels Like Bad Student Debt

Campus Crest Communities Inc. (NYSE: CCG) is a REIT tied to college campus living, with 86 student housing properties covering over 46,000 beds. In mid-December the company confirmed that its dividend would be cut, and the payout was dropped to $0.09 per share from a prior payout of $0.165. Its new yield is closer to 5%. Its lower dividend policy was targeting a balance sheet boost and liquidity improvement.

A resignation of its chief executive officer and chief financial officer a month earlier than the dividend cut announcement might have indicated some flaws were present. Now activist investors are involved, and more recently the company said it would explore strategic alternatives. With shares trading at $7.85 recently, its market cap is $508 million, and the 52-week range is $6.00 to $9.50.

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Civeo Has Trouble in Oil Accommodations

Civeo Corp. (NYSE: CVEO) was a huge victim of falling oil. Sure, the supermajors suffered as well, but they are far better hedged than this oilfield housing company. In fact, all this negative pressure on Civeo caused it to suspend its dividend in mid-December rather than to lower it. Previously, the company had paid a $0.13 per share quarterly cash dividend. To show how high that would be, that yield would be almost 14% at current prices.

Civeo said in an open letter to Canada’s National Energy Board in December that the dividend suspension was due to economic uncertainty in the oil industry:

As it became evident during the fourth quarter that capital spending budgets among the major oil companies were going to be cut, we began taking steps to reduce marketed room capacity, control costs and curtail discretionary capital expenditures. In Canada, we have since closed our Athabasca and Lakeside lodges and are evaluating similar actions in select other locations. We are limiting our discretionary capital spending in 2015 to those projects that are supported by customer contracts.

Shares have been trading around the $3.80 mark recently, against a 52-week trading range of $2.66 to $28.40.

Cliffs Going Off the Proverbial Dividend Cliff

Cliffs Natural Resources Inc. (NYSE: CLF) has been under the gun since last fall, due to issues at Bloom Lake. Cliffs has a huge debt to pay with the initial liabilities between $650 million to $700 million. It tried to lessen the blow by paying down short-term debt and repurchasing senior notes. The iron ore and metallurgical coal player announced at the end of January that it was eliminating the quarterly dividend for this quarter and all subsequent quarters.

Previously, the company had a quarterly cash dividend of $0.15 per share, which was an annual yield of 8.9% from current prices. A drop of almost 70% from last year’s high is just part of the story. Cliffs has been driving off the cliff for years. To prove this point, its stock was worth almost $100 back in 2011 and has not seemed to land anywhere stable.

Analysts have not come to defend Cliffs, and that was before the dividend vanished. Credit Suisse lowered its price target to $1 from $10 at the end of 2014, reflecting a huge shift in confidence that Cliffs cannot cut it. Shares of Cliffs were recently changing hands around $6.70. The stock has a 52-week trading range of $5.63 to $21.25.

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Cushing MLP Fund — “Mis-Adventures in MLP Funds”

The Cushing MLP Total Return Fund (NYSE: SRV) is one of the more speculative MLP closed-end mutual funds out there. It was the first of the common closed-end funds that had to lower its payout due partly to the following:

… reduced earnings from the Fund’s investments in certain upstream MLPs that were negatively impacted by the recent substantial downturn in crude oil and natural gas prices as well as the impact of leverage maintained by the fund.

Cushing’s new quarterly distribution was put at $0.055 per common share per quarter, for an annualized distribution rate of 3.55% at the time. That is far below its peers, and the fund said that distributions to shareholders will be changed from quarterly to monthly. Another warning: “It is anticipated but not certain that approximately 100% of the Fund’s distributions will be treated as a return of capital.” Shares dropped from $6.45 to $4.65 on the news, and they went lower since. Its 52-week range is $4.02 to 9.24, and its total assets before the price drop were listed as $326 million at the end of fiscal 2014.

ESI Turnaround Demands Saving Dividend Payouts

Electro Scientific Industries Inc. (NASDAQ: ESIO) may not seem like your typical dividend-paying company. It is in the field of laser-based manufacturing solutions for the microtechnology industry. It just recently announced that it will suspend its quarterly dividend, due to being “in the middle of a major turnaround” with plans to “return to long-term growth, profitability, and cash generation.” While the company talked about its opportunities ahead from an acquisition, with new products and expanding its sales channel, and broader customer interest, guess where the stock is relative to most turnarounds. At $6.50 most recently, its 52-week range is $5.96 to $10.32.

Electro Scientific is a small cap stock worth almost $200 million, but its prior yield was almost 5%. Very few analysts covering the stock, but the general expectation was for losses in 2015 and 2016. The company said this will help it recapture opportunities and will help it maintain its financial strength. That being said, ESI did not change its guidance or financial goals ahead.

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Gold and Silver Dividend Trends in Newmont and Silver Wheaton

Newmont Mining Corp. (NYSE: NEM) and Silver Wheaton Corp. (NYSE: SLW) are examples of dividend cuts in the gold and silver mining sector. While these are not the freshest dividend cuts of the featured companies slashing their dividends, they do indicate that the payouts and the massive interest in gold and silver companies when prices were so high just do not hold water when the commodity prices are much lower. The good news is that both of these companies likely can return to higher payouts rapidly if gold and silver prices rise ahead.

Silver Wheaton’s dividend yield is barely 1% now and is less than half of its biggest payout seen in only one quarter in 2013. Newmont’s dividend of $0.025 per quarter represents over a 90% cut from its peak, with a yield now less than 0.5%. Newmont’s dividend threshold had been tied to much higher gold prices back during the gold boom.

Both Newmont and Silver Wheaton stocks are handily off their post-bubble highs, yet the market caps remain high. Newmont and Silver Wheaton are still worth almost $13 billion and almost $8 billion, respectively. What is interesting is that the gold and silver stocks have recovered much more than gold and silver did. Newmont’s $26 share price compares to a 52-week range of $17.60 to $27.40, while Silver Wheaton’s share price of $21.30 is against a 52-week range of $16.57 to $27.66.

Linn Rewarded for More Conservative Payouts

Linn Energy LLC (NASDAQ: LINE) and LinnCo LLC (NASDAQ: LNCO) are considered two-in-one by many MLP and oil and gas infrastructure investors. A joint press release in the starting hours of 2015 showed that the Linn annual budget would cut capital spending roughly in half to $730 million. Its new budget was based on significantly lower crude oil price than in 2014, and assumed an unhedged NYMEX price of $60 a barrel.

The reduction of the Linn distribution and LinnCo dividend was to an annualized $1.25 per unit or share, from the previous level of $2.90 per unit or share. Linn simultaneously announced that it had signed a non-binding letter of intent with the credit platform of Blackstone Group L.P. (NYSE: BX) to fund oil and natural gas development ahead.

It turns out that moderation is sometimes rewarded. Linn Energy saw its unit price rise to $11.15 from $9.95 when it announced this news. The price was recently higher at $12.30, but the 52-week range is now $9.05 to $33.30. LinnCo rose to $11.30 from $10.19 on the first trading day of January, and it was recently trading at $11.43, against a 52-week range of $8.58 to $31.57. These both traded higher on lower dividends and distributions, but they obviously have a long way to go before they are back to being at old highs again.

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Peabody Dividend Turns Coal Into Tar and Feathers

Peabody Energy Corp. (NYSE: BTU) recently has seen its operations falter due to the current environment for domestic coal. The company had a huge loss for 2014, versus prior years of operating profits. The big news from Peabody at the end of January was that it slashed its dividend from $0.085 per share per quarter to $0.0025 — or $0.01 annually, from $0.34. This is what investors call a token dividend, just to allow “income-only funds” to still own the stock.

Peabody’s 2015 production is said to be 95% fully priced, and 2016 production remains about 45% to 55% unpriced, yet it is expected to keep losing money, with analysts looking for a wide loss in 2015. The question is not just whether the dividend can return, but whether it and the rest of the U.S. coal mining sector can survive more years of the same treatment under the current administration.

Peabody is far from being alone here. Walter Energy Inc. (NYSE: WLT) finally suspended even its $0.01 quarterly dividend with a January announcement, after it was cut from a $0.125 payout prior to mid-2013. Elsewhere in coal there have even been bankruptcies, and many former coal giants are struggling to survive.

Prospects Elsewhere for BDC Dividends?

Prospect Capital Corp. (NASDAQ: PSEC) is one of the most well-known business development companies (BDCs), and it cut its payout in December. The company also suspended its at-the-market equity issuances for the indefinite future. Prospect said at the time that its concentration in the energy sector was only 5.1%, and starting in 2015 the monthly payouts would drop to 0.08333 cents per share. The BDC is trying to work with less risk and a focus on higher earnings quality via more first lien loans and accepting lower interest rates.

Being in the business development segment can also come with volatility around earnings and payouts through business cycles. Prospect simultaneously said that it expects to declare its May, June, July and August 2015 monthly distributions in May 2015, and it indicated that its current lower payouts would just be the minimum required. Does that mean that the payouts could rise again? Prospect’s prior payouts had been closer to $0.11 per share — and the new yield still carries a whopping 11.5% yield equivalent. With shares at $8.67, Prospect’s 52-week range is $8.02 to $11.10. It signaled that its net asset value per share on December 31, 2014 stood at $10.35 per share.

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SeaDrill’s Dividend Gets Drilled

SeaDrill Ltd. (NYSE: SDRL) is an offshore drilling contractor targeting the oil and gas sector. What stood out here was that this was the first of the larger offshore drillers to enter the confessional booth by suspending its dividend payments. Shares were above $20 in late November, and when it slashed the payout shares fell to under $15 in short order — and now shares were recently down under $12. With a 52-week range of $9.18 to $40.44, it still has a market cap of about $5.8 billion.

When SeaDrill suspended its dividend in November, the claimed intention was to focus on creating value opportunities and to reduce debt. Analysts and investors were worried about this outfit having a dividend risk because the prior two quarterly payouts were up at $1.00. That would have been a magic 20% yield had it been maintained. Amazingly, analysts still see positive earnings for 2015. Does that mean that the payout will resume as soon as project fulfillment allows for better earnings?

Like Transocean Could Pay a 15% Yield

Transocean Ltd. (NYSE: RIG) had a payout that was so high it had no choice but to be cut. The company is a global player in the offshore contract drilling services for oil and gas wells, and the drop in energy prices has hurt big time. Can you imagine when investors screen for high-yield stocks and see a yield of over 15%? That had been the case up until mid-February.

Transocean had been expected to lower its dividend for some time, but the new $0.60 payout sounded OK on the surface, versus a prior $0.75 payout, but the new payout is over four installments. That really means the payout will be $0.15 per quarter, a drop of 80% to its quarterly payout. This was also said to be out of additional paid-in capital. What the company may have signaled to investors, without formally stating it, is that there are still risks ahead. Its CEO departure (or ouster) was not taken as a good sign of a solid outfit. Shares were close to $16 of late, against a 52-week range of $14.50 to $46.12. Does it matter this was way over $100 during the 2008 oil bubble?

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