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Dear Investor,

One of the primary drivers of this never-ending bull market has been the pitiful ultra-low-yield environment for traditional income investments.

Despite the Federal Reserve’s series of interest rate hikes, investors are still starving for income and unfortunately, they are taking on extra risk to get it.

Faced with 0.1% – 2% yields, they have rushed into alternative income paying investments of all types.

Dividend-paying stocks, REITs, MLPS (Master Limited Partnerships) … all promise dividend yields higher than what you can earn in traditional income investments like CDs, money markets and Treasury bonds.

But too many of the people who are pouring billions into these investments for the income have forgotten something critical—the fundamentals.

Not all dividend stocks are created equal—and as you read this, there are hundreds that are at risk of cutting or eliminating their dividends.  Or worse, companies that pay a fat yield but go nowhere, or cost you more in losses than the dividend they are generating!

For example, in order to draw investors in, some companies turned to generous dividend payments and big share buybacks.

And investors took the bait, buying up shares in order to get 3%, 4%, even 5% yields or higher.

Unfortunately, many of these companies either took on extra debt or put too much of their free cash flow into these payments.

That makes the fundamentals of the company weaker, increasing the chances of both a falling dividend AND a falling share price.

Are Your Dividends in Danger?

I recently saw an alarming report from one Wall Street research firm that sells their reports to the movers, shakers and hedge fund managers on Wall Street. It listed almost 30 “precarious dividend payers” … companies with poor financial discipline that have put themselves in a position where the dividends are no longer safe.

And some of the names on this list will shock you… Coca-Cola, IBM, Ford, American Express, Dunkin’ Brands—these are household names millions of investors own.

The payout ratio of some of the stocks on this list were particularly shocking…
370% for Abercrombie and Fitch… 247% for Wendy’s… 131% for Harley-Davidson… 97% for Coca-Cola.

If you promised to pay out nearly 100% of your income each year—not to mention 370%—how long do you think it would be before you needed to either make a significant change like cutting your dividend or filing for bankruptcy?

But I have to be honest, the most shocking thing to me wasn’t the actual names on the list—some of the same names are on my latest list of dangerous dividend stocks to avoid.

No, the most surprising thing to me was that their list only had about 30 stocks.

The truth is there are many, many more dangerous dividend stocks in the market right now.

At last count over 298 stocks have cut their dividends so far in 2017. 

And I’ve just run my own analysis and my list of risky dividend stocks to sell now is already over 150 names.

My full list will be available Monday, but I didn’t want to wait until then to share the first group of names with you.  Here are 27 dividend stocks to sell now so you can check your portfolio and start ridding yourself of these landmines right now…

Sell These Stocks Today

Stock Name Ticker
Grader Score
Advance Auto Parts (AAP) D
Allergan Plc (AGN) F
Ally Financial (ALLY) D
AMC Entertainment Holdings, Inc. (AMC) F
Bank of Commerce Holdings (BOCH) D
Blackrock Capital (BKCC) F
Bristol Meyers Squibb (BMY) D
Coca-Cola (KO) F
Colgate-Palmolive (CL) F
Halliburton (HAL) D
Hewlett Packard (HPE) D
Hilton Hotels (HLT) F
J.M. Smucker (SJM) D
Juniper Networks (JNPR) D
KB Home (KBH) D
KraftHeinz (KHC) F
Lowes Corp (L) D
Marvell Technology Group (MRVL) F
Molson Coors (TAP) D
Monsanto (MON) D
Ralph Lauren (RL) D
Sirius XM (SIRI) D
Symantec (SYMC) F
U.S. Steel (X) F
Weyerhaeuser (WY) F
Xerox (XRX) F
Yum Brands (YUM) F

As I said, I am running a full analysis on more than 1,500 dividend-paying stocks right now. I’ll be spending the weekend analyzing the latest data—and I’m expecting to turn up even more big names to sell. 

You’ll hear from me on Monday with the final results, but right now there are already well over 150 names on the list.

You still have some time to get out of these dangerous stocks, but not much.  Earnings season is just around corner and that could be the pin that pops the high yield bubble for some of these stocks.

In the meantime, I’ll be back in touch tomorrow with your second special briefing.  In it, you’ll hear about investors who got conned into buying into a dividend-paying investment that brokers have been pushing hard the past several years.

It looks just like a popular income investment you’re already familiar with, but it’s really a privately-traded asset with little regulation and no protection.

Investors were often promised as much as 10% per year in annual income… only to see losses of as much as 10% to 20% per year, with virtually no chance of getting out when they wanted to.

It wasn’t easy, but we found a few industry insiders who agreed to talk to us anonymously to help expose Wall Street’s latest scam.

Watch your inbox tomorrow for a link to this groundbreaking research so you can protect yourself.   It’s one of the most appalling schemes I’ve ever seen.

Louis Navellier, Editor
Navellier Growth

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