SMASHED! Why these 5 dividend stars plunged last week

Credit: DubSnipe

What an interesting week!

The S&P/ASX 200 (Index:^AXJO) (ASX:XJO) fell 0.85% last week, but that disguises the huge range of results that our larger cap stocks returned. Results varied from a 19% fall for St Barbara Ltd (ASX: SBM) to an 11% rise for Seven West Media Ltd (ASX: SWM). Most of our larger cap stocks finished somewhere in between.

5 dividend stars smashed!

Interestingly, a number of big dividend stocks really suffered during the week. However a quick analysis shows that there are a range of issues hitting companies at the moment. Let’s take a look at some of last week’s big fallers.

Sky Network Television Ltd (ASX: SKT) (7.2% trailing yield, down 15.5%) dropped after reporting that the company’s full year EBITDA would be 15% below the company’s EBITDA in 2016 and 27% below 2015’s result.

Regis Resources Limited (ASX: RRL) (6.2% trailing yield, down 11.8%) fell due to the gold price falling on the back of the US rate rise.

Santos Ltd (ASX: STO) (5.1% trailing yield, down 7.9%) fell after the company announced a capital raising aiming at bringing in another $1.04bn after raising $2.5bn last year.

Genesis Energy Ltd (ASX: GNE) (8.2% trailing yield, down 7.5%) dropped as the oil price fell to the lowest point in over a week and the US dollar improved.

Seven Group Holdings Ltd (ASX: SVW) (5% trailing yield, down 6.9%) appears to have fallen for the same reason as Genesis. This is related to its stake in oil and gas projects and its exposure to the US dollar.

Where to from here?

Some analysis after the US rate rise pointed to dividend-focused stocks struggling as investors move funds from Australia to the US now that higher rates are on offer. That could mean that some of our favourite dividend stocks get even cheaper.


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Motley Fool contributor Andrew Mudie has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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