Skip to main content

5 Scary Dividend Stocks to Sell in October

By U.S. News & World Report

It’s the best of times and the worst of times for income-oriented investors right now. The good news is that the U.S. Federal Reserve seems to be serious about raising interest rates.

Policymakers have raised interest rates three times in 12 months, and have been clear that investors should expect another rate hike by year end. This push and pull on interest rates will mean a lot of uncertainty for income investors.

So how do you know which investments are tricks, and which ones are treats? To help you decide, here’s a list of dividend stocks that look awfully scary this October, and may be worth selling.

General Electric Co. (NYSE: GE)

General Electric was a favorite of long-term, income-oriented investors. Now, it’s one of the least popular blue chips on Wall Street.

Shares are down more than 20 percent so far this year, making it the biggest loser among Dow Jones industrial average components in 2017. Revenue and profits are flat, and short-term fixes can’t be repeated in future quarters.

With a dividend north of 3 percent, you may be tempted to bargain hunt in GE because it’s such a big and respected name. But keep in mind that analysts from JPMorgan recently labeled GE a sell because it’s “worse than we think.”

Take their advice and leave this spooky stock behind in October before it falls further.

Click here to learn more about GE stock.

Coca-Cola Co. (KO)

While it may be one of the most powerful brands in the world, Coca-Cola still faces the unfortunate reality that its flagship products are out of favor.

Sure, Coke has tried to diversify with its Full Throttle energy drinks, Powerade sports drinks and Dasani bottled water. But fizzy, sugary beverages are still its forte. That’s bad news, because soda consumption has hit a 30-year low. And, shares have only delivered a fraction of gains seen in the broader market.

Longer term, KO stock has risen less than 20 percent in the last five years versus over 70 percent for the Standard & Poor’s 500 index. You can get much better returns — and even better dividends — elsewhere.

Click here to learn more about KO stock.

AMC Entertainment Holdings (AMC)

Another stock in trouble because of widespread changes in consumer behavior is AMC.

The movie theater operator may pay a dividend north of 5 percent, however it is stuck in a rather rough spot as theater viewership is steadily declining. Just consider that the summer blockbuster season just wrapped up its worst run in 11 years.

AMC will actually finish fiscal 2017 operating at a loss as it looks to restructure and invest big in digital initiatives that could pay off down the road. But it remains to be seen what the company can do to stop this broad shift in consumer behavior and the company is doomed for a frightening 2018.

Click here to learn more about AMC stock.

Centurylink (CTL)

It’s rough for smaller telecoms. Look at the roughly 40 percent decline in Centurylink from its 52-week high at the end of 2016.

Adding to shareholders’ pain is the prospect of dividend cuts. Right now, the $2.16 annual dividend payout of CTL is well above the $1.90 or so in earnings predicted this year.

CTL is finalizing a massive $24 billion merger with Level 3 in an ambitious bid to upgrade its high-speed internet business, requiring capital when there isn’t much to spare. The merger is a bold gambit, but also a last-ditch effort to survive in a space dominated by bigger telecom players. Don’t be taken in by a double-digit dividend yield.

Click here to learn more about CTL stock.

Campbell Soup Co. (CPB)

Campbell Soup is another powerful brand behind the times of consumer tastes.

Sure, it used to be a powerhouse of comfort foods. And yes, it has other offerings — including Prego sauces and V8 juices. But CPB stock is a stagnant company that is at best stagnant and is at worst slowly declining.

Sales will decline modestly in fiscal 2017 if predictions hold, and will grow a measly 1 percent in 2018. The company has fallen short fairly regularly when reporting its quarterly profits — most recently in August where it also lowered its guidance.

What good is a 3 percent dividend when shares are down more than 20 percent and looking to head lower?

Click here to learn more about CPB stock.

More from U.S. News

20 Awesome Dividend Stocks for Guaranteed Income

7 Dividend Growth Stocks to Buy Now

8 Stocks to Buy For a Starter Portfolio

5 Scary Dividend Stocks to Sell in October originally appeared on usnews.com

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
Read Next Story

Related News

Matt Amodio’s ‘Jeopardy’ winning streak ends after 38 consecutive victories

Biden warns another terrorist attack ‘highly likely’ at Kabul Airport; Americans told to stay away

Naomi Osaka ‘refreshed and happy’ as she kicks off her Olympic campaign with dominant victory against Saisai Zheng