Economy Companies suspend dividends and buybacks as the pandemic weakens...

Companies suspend dividends and buybacks as the pandemic weakens the market

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Dividends and buybacks are the primary means by which companies reward their shareholders. Shareholders can also earn returns from capital gains or price increases that may or may not be under the control of the company.

With desperate times requiring desperate measures, a number of companies have announced suspension of dividends, buybacks, or both as the coronavirus pandemic strikes the market.

Why companies press the pause button

These steps result from the need to save money as companies navigate a turbulent phase that is likely to reach their income statement.

There is also a political reason to be prudent, as Congress is about to adopt a trillion-dollar stimulus package. Legislators have spoken out against companies that waste aid with buybacks.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "See also: Powell expects an atypical downturn as the liquidity, the credit runs dry, but says nothing “data-reactid =” 24 “>See also: Powell expects an atypical downturn as the liquidity, the credit runs dry, but says nothing

The following companies have announced shareholder suspension programs after the pandemic.

<p class = "Canvas-Atom Canvas-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "I.ntel Corporation (NASDAQ: INTC) announced on an 8K filing Tuesday that the share buyback would be suspended due to the pandemic. The company said the decision was prudent given the length and uncertainty of the pandemic. Dividends are not affected, Intel said. “Data reactid =” 26 “> I.ntel Corporation (NASDAQ: INTC) announced on an 8K filing Tuesday that the share buyback would be suspended due to the pandemic. The company said the decision was prudent given the length and uncertainty of the pandemic. Dividends will not be affected, Intel said.

The suspension prevents a $ 20 billion buyback that the company announced in October 2019.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Ford Motor Company (NYSE: F) announced on March 19 that the dividend will be suspended to save cash and offer additional flexibility. The automaker also withdrew its instructions. “Data reactid =” 28 “>Ford Motor Company (NYSE: F) announced on March 19 that the dividend will be suspended to save cash and offer additional flexibility. The automaker also withdrew its leadership.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Boeing Co. (NYSE: BA), which is affected by both fundamental and geopolitical problems, announced the suspension of its dividend program. The company also said it will extend the pause in its share buybacks. “data-reactid =” 29 “>Boeing Co. (NYSE: BA), which is affected by both fundamental and geopolitical problems, announced the suspension of its dividend program. The company also said it will extend the pause in its share buybacks.

<p class = "Canvas-Atom Canvas-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Big banks JPMorgan Chase & Co. (NYSE: JPM), Bank of America Corp. (NYSE: BAC), Citigroup Inc. (NYSE: C), Goldman Sachs Group Inc. (NYSE: GS), Morgan Stanley (NYSE: MS), Wells Fargo & Co. (NYSE: WFC), Bank of New York Mellon Corp. (NYSE: BK) and State Street Corp. (NYSE: STT) have all suspended their buybacks until the second quarter to borrow money from individuals and businesses. “Data reactid =” 30 “> Big banks JPMorgan Chase & Co. (NYSE: JPM), Bank of America Corp. (NYSE: BAC), Citigroup Inc. (NYSE: C), Goldman Sachs Group Inc. (NYSE: GS), Morgan Stanley (NYSE: MS), Wells Fargo & Co. (NYSE: WFC), Bank of New York Mellon Corp. (NYSE: BK) and State Street Corp. (NYSE: STT) have all suspended their buybacks until the second quarter to borrow money from individuals and businesses.

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<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "oil giant Royal Dutch Shell plc ADR Class A. (NYSE: RDS-A) and Total SA (NYSE: TOT), which are facing a sharp drop in oil prices, have also announced buyback standstills, while most other oil companies have indicated that they will cut their capital spending. “data-reactid =” 31 “> oil giants Royal Dutch Shell plc ADR Class A. (NYSE: RDS-A) and Total SA (NYSE: TOT), which are facing a sharp drop in oil prices, have also announced buyback standstills, while most other oil companies have indicated that they will cut their capital spending.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Mcdonald’s Corp’s (NYSE: MCD) CEO Chris Kempczinsk said in an interview with CNBC that the company had suspended its $ 15 billion buyback a few weeks ago. “Data reactid =” 32 “>Mcdonald’s Corp’s (NYSE: MCD) CEO Chris Kempczinsk said in an interview with CNBC that the company had suspended its $ 15 billion buyback a few weeks ago.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "department stores Macy’s Inc. (NYSE: M) and Nordstrom, Inc. (NYSE: JWN) suspended their respective dividends, while Nordstrom also stopped buybacks. peer Kohl’s Corporation (NYSE: KSS) has withdrawn its buyback program and proposed to evaluate the dividend. “Data-reactid =” 33 “> department stores Macy’s Inc. (NYSE: M) and Nordstrom, Inc. (NYSE: JWN) suspended their respective dividends, while Nordstrom also stopped buybacks. peer Kohl’s Corporation (NYSE: KSS) has withdrawn its buyback program and proposed to evaluate the dividend.

<p class = "Canvas-Atom Canvas-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Miner Freeport-McMoRan Inc. (NYSE: FCX) announced the suspension of its dividend. “Data reactid =” 34 “> Miner Freeport-McMoRan Inc. (NYSE: FCX) announced the suspension of its dividend.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Marriott International Inc. (NASDAQ: MAR) announced that dividend payments will cease on March 31 after a previously announced dividend for the first quarter is paid. “Data reactid =” 35 “>Marriott International Inc. (NASDAQ: MAR) announced that dividend payments will cease on March 31 after a previously announced dividend for the first quarter is paid.

<p class = "Canvas-Atom Canvas-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Telecommunications giant AT&T Inc. (NYSE: T) announced the suspension of its buyback program to protect its dividend. “Data-reactid =” 36 “> Telecommunications giant AT&T Inc. (NYSE: T) announced the suspension of its buyback program to protect the dividend.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Among airlines, Delta Air Lines, Inc. (NYSE: DAL) announced on March 10 that it would suspend buybacks and defer investments of $ 500 million. The company then announced on March 20 that it would temporarily suspend future dividend payments. Alaska Air Group, Inc. (NASDAQ: ALK) also said it will suspend its dividend program while reducing 70% of its capacity. “Data-reactid =” 37 “> Among the airlines Delta Air Lines, Inc. (NYSE: DAL) announced on March 10 that it would suspend buybacks and defer investments of $ 500 million. The company then announced on March 20 that it would temporarily suspend future dividend payments. Alaska Air Group, Inc. (NASDAQ: ALK) also said it will suspend its dividend program while reducing 70% of its capacity.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Benzinga covers every aspect of how the corona virus affects the financial world. Sign up for daily updates to our Coronavirus newsletter.“data-reactid =” 38 “>Benzinga covers every aspect of how the corona virus affects the financial world. Sign up for daily updates to our Coronavirus newsletter.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "See more from Benzinga“data-reactid =” 39 “>See more from Benzinga

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "© 2020 Benzinga.com. Benzinga does not offer investment advice. All rights reserved.“data-reactid =” 44 “>© 2020 Benzinga.com. Benzinga does not offer investment advice. All rights reserved.

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