8 REITs at High Risk of Cutting Dividends and 3 Safer Options
Published Jul 25, 2011 on Seeking Alpha

We took a look at a few high-yielders with lofty payout ratios. These types of companies tend to be “real-estate investment trusts” or REITs that distribute cash flows and earnings with different standards so dividends stay safe. However, we think these names could see some turbulence ahead, and may have to reduce the dividend payout. Instead, we recommend investors take a look at dividend stocks that are undervalued like Intel (INTC), International Business Machines (IBM) and Home Depot (HD). Consider the below as a list of red flags that should be alerting investors: Macerich Company (MAC) is a REIT involved with retail real-estate in California, such as shopping malls and plazas. This equity pays out an amazing $2.00 dividend on just $0.23 reported, for a wholly unhealthy 8.7 payout ratio. But as this is an REIT, earnings are accounted for differently so what’s more important for the dividend will be... Read more