This article will look into last week’s 10 worst dividend stocks.
Dividend stocks have historically been the top preference for many investors seeking stable income. However, as the years progress, the markets and the companies go through changes that affect the value of the investments made by the investors. It becomes necessary to review companies’ performance in the market at frequent intervals. In this regard, the list we have put together will show the worst performances of some high dividend-paying companies. The list might help you make informed decisions with your investment.
The second week of February 2025 was not favorable for some dividend stocks. Multiple factors contributed to these stocks’ fall in performance, including sector-wise challenges and broader economic trends. Shifts in monetary policy, like interest changes, could have a notable effect on dividend-paying stocks. The impact would be multifold for companies in specific sectors like utilities or real estate. Macroeconomic conditions like geopolitical tensions or decreasing consumer demand have also imprinted on particular companies.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
Though the dividend stocks may have perceived stability, it is necessary to remember that they are not immune to market volatility. Consistency in the dividend payouts can be viewed as a good sign. However, with declining stock prices, there will be a fall in the dividend benefits. In other words, even if a company maintains its payout, the return on investment for the investor could still become negative. Hence, there arises a need to assess the factors contributing to the stock performance in addition to evaluating a company’s dividend yield.
By understanding the reasons behind the poor performances of the stocks in our list, investors can redefine their investment strategy. Consecutively, the information in this article helps identify the companies that lagged in their performances in the last week and also assists the investors in learning from these instances. A disciplined approach to portfolio management always includes learning from the examples. It ensures that we are better prepared to handle market fluctuations in the future. You can be a seasoned investor or a newcomer to dividend stocks. Understanding the factors driving the performance of the company’s value would be immensely useful to you in achieving long-term financial success.
When going through the list, the investors may consider the fitting of these companies in their broader investment strategy. It is important to remember that the performances we will look at in this article are only one week’s performance and do not reflect the future performance of these stocks. It is up to the investors to decide whether these stocks are worth holding onto despite recent setbacks or if their struggles are signaling deeper issues. The article is only an opportunity to reassess the portfolio to match your financial goals.
With that, let’s examine the 10 worst-performing dividend stocks from last week. We will count these stocks from 10 to 1, so stick with us as we unveil the biggest underperformer.
Our Methodology
In this article, we focused on identifying dividend stocks that have underperformed during the last week, between 10th February and 14th February 2025. The selection criteria required stocks to have a minimum dividend yield of 2%. It helps in keeping the article relevant for income-focused investors. Additionally, we took into our list, only companies with a market capitalization of at least $300 million. With this, we were able to maintain a focus on widely traded companies. Another criterion is that the stocks must have experienced a decline of at least 3% during the specified period as this will help in ensuring the inclusion of significant underperformers in the market. The stocks are ranked according to their dividend yields.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10. RTX Corporation (NYSE:RTX)
Dividend yield: 2.06%
Dividend payout ratio: 69.86%
Ex-Dividend Date: February 21, 2025
Number of Hedge Funds: 71
RTX Corporation (NYSE:RTX) saw a decline of 3.86% in its value during the last week, between February 10 and 14, 2025.
The Virginia-based multinational aerospace and defense conglomerate experienced a decrease in its valuation primarily after the new U.S. President, Donald Trump, announced in a press report his intention to sit down with China and Russia and discuss cutting the defense spending by half. On the other hand, DOGE and Elon Musk are pursuing more immediate strategies to decrease defense spending. While the whole industry is affected by this report, RTX Corporation (NYSE:RTX) felt its effect more strongly because half its revenues come from defense spending in the U.S.
RTX Corporation (NYSE:RTX) offers a dividend yield of 2.06%. Though one of the lowest dividend yields on our list, it is supported by the company’s long history of paying dividends. It has also increased its dividend payout for five consecutive years. The dividend payout ratio of 69.86% indicates a moderate balance between retained earnings and dividend payments. The company is subject to strong institutional interest as it is a part of 71 hedge fund portfolios tracked by Insider Monkey at the end of Q3 2024. Investors purchasing the shares before February 21, 2025, will be eligible for the dividend payout on March 20, 2025.
9. Essent Group Ltd. (NYSE:ESNT)
Dividend yield: 2.20%
Dividend payout ratio: 15.80%
Ex-Dividend Date: March 14, 2025
Number of Hedge Funds: 24
Essent Group Ltd. (NYSE:ESNT) saw a 3.69% decline in its value during the last week, between February 10 and February 14, 2025.
The EPS of Essent Group Ltd. (NYSE:ESNT) during the fourth quarter of 2024 stands at $1.58, which missed the estimated EPS of $1.65 by approximately 4.2%. However, the company realized a positive trend in its revenue. The company reported a revenue of $315 million which was more than the expected value of $313.64 million. The performance is mixed and reflects the challenges faced by Essent Group Ltd. in missing its profitability goals despite experiencing growth in its revenue. Mark A. Casale, Chairman, and Chief Executive Officer stated:
“We believe Essent is well positioned to continue producing strong returns and growing book value per share. The increased dividend and new share repurchase authorization demonstrate our confidence in the stability of Essent’s cash flows and our commitment to a balanced approach to capital management moving forward.”
You can read more about the Essent Group Ltd. (NYSE:ESNT) Q4 2024 Earnings Call Transcript here. Essent Group Ltd. (NYSE:ESNT) offers a dividend yield of 2.20%. The dividend payout ratio is 15.80% – one of the lowest payout ratios on our list. Such a low ratio may attract criticism from investors. While the ratio indicates that the company is retaining a substantial portion of its earnings for reinvestment purposes, it may disappoint the investors who are focused on income and seeking higher returns. A strong institutional interest is recognized with 24 hedge fund portfolios listed in Insider Monkey, owning stakes in the company at the end of Q3 2024.
8. OFG Bancorp (NYSE:OFG)
Dividend yield: 2.87%
Dividend payout ratio: 23.64%
Ex-Dividend Date: March 31, 2025
Number of Hedge Funds: 23
OFG Bancorp (NYSE:OFG), a Puerto Rico-based financial holding company, experienced a decline in value by 3.62% during the last week.
Compared to the third quarter of 2024, OFG Bancorp (NYSE:OFG)’s fourth quarter saw a sharp decline in government deposits. Though the commercial and retail deposits experienced an increase during the same quarter, the decline of the government deposits seems to have affected the company’s valuations last week. Despite the strong financial results, the company faces higher credit loss provisions. The credit loss has increased from $19.7 million to $30.2 million year-over-year in the fourth quarter of 2024 due to an increased loan volume. Along with the credit loss, the noninterest expenses also increased to $99.7 million, negatively affecting the company’s valuation.
The dividend yield offered by the company stands at 2.87% and OFG Bancorp (NYSE:OFG) backs this dividend with a payout ratio of 23.64%. The remaining portion of the earnings retained by the company could be used for debt repayment or reinvestment, indicating sustainability in the company’s financial health—the number of hedge fund portfolios that held OFG amounted to 23 at the end of Q3 2024. Investors interested in the next dividend payment can purchase the shares of the company before March 31, 2025.
7. Northrim BanCorp, Inc. (NASDAQ:NRIM)
Dividend yield: 3.05%
Dividend payout ratio: 37.16%
Ex-Dividend Date: March 6, 2025
Number of Hedge Funds: 7
A 3.75% decline in value was seen in Northrim BanCorp, Inc. (NASDAQ:NRIM) during the last week from February 10 to 14, 2025.
The decline comes after Empowered Funds LLC reduced its ownership in Northrim BanCorp, Inc. (NASDAQ:NRIM) by 15.1% during the fourth quarter of 2024. After selling 3,132 shares of the financial holding company, Empowered Funds LLC owned approximately 17,565 shares of Northrim BanCorp, valued at over $1.3 million, by the end of the recent quarter. Similarly, other institutional investors bought and sold the company’s shares during the recent quarter, leading to a decline in the company’s valuation.
Northrim BanCorp, Inc. (NASDAQ:NRIM) offers a dividend yield of 3.05%, which is backed up by a dividend payout ratio of 37.16%. Since the company uses only one-third of its earnings for dividend payments, the remaining is retained for debt repayment purposes or future investments. However, the number of hedge fund portfolios owning a stake in the company amounts to 7, representing low interest from institutional investors. The next dividend payment for the company is March 14, 2025. Investors benefiting from this payout must purchase the company’s shares before March 6, 2025.
6. Embecta Corp. (NASDAQ:EMBC)
Dividend yield: 4.04%
Dividend payout ratio: 60.61%
Ex-Dividend Date: February 28, 2025
Number of Hedge Funds: 22
During the last week, between February 10 and February 14, 2025, Embecta Corp. (NASDAQ:EMBC) saw a decline of 14.36% in its value, despite the company receiving an upgrade from Neutral to Buy by BTIG.
One of the most significant declines on our list, the fall of 14.36% of Embecta Corp.’s (NASDAQ:EMBC) value, was primarily contributed by insider selling. Director Milton Mayo Morries sold a significant portion of the company’s stocks on February 13, 2025. The total value of the transaction stood at $50,778, with the price per share at $16.38. After the transaction, the shares owned by the director reduced to 36,133 shares, which is valued at around $591,858. Embecta Corp. (NASDAQ:EMBC) also announced its intention to abandon its insulin patch pump program due to external pressures from competitors and high costs after announcing its FDA approval in the last quarter.
The dividend yield offered by the company stands at 4.04%. Embecta Corp. (NASDAQ:EMBC) backs up the dividend with its payout ratio of 60.61%. This indicates a healthy balance between earnings for reinvestment and dividend payments. Embecta Corp. is part of 22 hedge fund portfolios in Insider Monkey’s database. It reflects institutional investors’ interest in the stock. The next dividend payment date is March 14, 2025.
5. Kite Realty Group Trust (NYSE:KRG)
Dividend yield: 4.83%
Dividend payout ratio: 49%
Ex-Dividend Date: April 9, 2025
Number of Hedge Funds: 24
Kite Realty Group Trust (NYSE:KRG) saw a 3.87% decline in its stock value, in the last week between February 10 and February 14, 2025.
The real estate investment trust, engaged in the business of owning and managing open-air shopping centers and mixed-use properties, faced the week’s decline after its 2024 fourth-quarter earnings calls, where it was reported that the recent bankruptcies are expected to make an impact on the Adjusted Fund from Operations (AFFO) and the growth of its cash flow. Additionally, the gap between leased and occupied rates is high. This causes a delay in wholly occupying the leased properties, affecting the company’s aim to achieve a net operating income of $27 million. It led to downward company valuation adjustments during the last week.
Kite Realty Group Trust (NYSE:KRG) offers a dividend yield of 4.83%. However, the company’s payout ratio stands at 3,800%, making it one of the largest on our list. This means that the company is paying $38 in dividends for every dollar of profit it earns. The approach is risky because it drains resources and increases liabilities for the company. Twenty-four hedge funds in our database showed interest in the stocks at the end of Q3 2024. To be eligible for the next dividend, an investor must purchase the stock before April 9, 2025.
4. Magna International Inc. (NYSE:MGA)
Dividend yield: 5.13%
Dividend payout ratio: 53.98%
Ex-Dividend Date: February 28, 2025
Number of Hedge Funds: 16
The Canada-based parts manufacturer for automakers, Magna International Inc. (NYSE:MGA), experienced a decline in its value by 3.08% between February 10 and February 14, 2025.
Magna International Inc. (NYSE:MGA)’s performance is heavily influenced by the industry-specific challenges, which increased after the new Presidency in the U.S. The latest U.S. tariffs are expected to be unfavorable for many importers, including steel and aluminum importers, especially from Canada and Mexico. On February 3, the duties have been paused temporarily for a month. The actual effect of these new tariffs remains uncertain in the long run. After considering these effects, the company changed its expected Fiscal 2026 revenue from $51.20 billion to $42.60 billion. This is negatively reflected in the last week’s share price performances.
Magna International Inc. (NYSE:MGA) offers a dividend yield of 5.13%. It has set its dividend payout ratio at 53.98%. The latter indicates a balance between using earnings for dividend payouts and retaining them for reinvestment. Sixteen hedge fund portfolios tracked by Insider Monkey owned stakes in the company at the end of Q3 2024, suggesting institutional investors’ interest in the stock. Investors willing to invest in Magna can do so, before February 28, 2025.
3. The Chemours Company (NYSE:CC)
Dividend yield: 5.94%
Dividend payout ratio: 200%
Ex-Dividend Date: February 28, 2025
Number of Hedge Funds: 29
The Chemours Company (NYSE:CC) stocks fell 8.88% last week, ending February 14, 2025. The decline comes after the company reported its fourth-quarter EPS of $0.11. These reported earnings were below the analyst’s estimated fall of $0.12. Though the revenue for the quarter stood at $1.4 billion, close to the estimate of $1.37 billion, the share prices ultimately incurred a fall during the week.
Following the reports from The Chemours Company (NYSE:CC), five investment analysts have rated the stock with a “Hold” recommendation. Meanwhile, four analysts have assigned a “Buy” recommendation to the stock. Over the past year, analysts have provided ratings on the stock. This has led to an average 1-year price target of $24.11 for the stock as of February 18, 2025.
The Chemours Company (NYSE:CC) offers an attractive dividend yield of 5.94%. However, the dividend payout ratio stands at 200%, indicating that the company is paying out dividends double its net income. It may either mean tapping into the reserves or using debt to make its dividend payment. Both would depreciate the investment value. However, the company is part of 29 hedge fund portfolios followed by Insider Monkey. This indicates moderate interest from institutional investors. The ex-dividend date suggests that investors interested in the stock can purchase before February 28, 2025.
2. Piedmont Office Realty Trust, Inc. (NYSE:PDM)
Dividend yield: 6.84%
Dividend payout ratio: 167.78%
Ex-Dividend Date: February 21, 2025
Number of Hedge Funds: 15
Piedmont Office Realty Trust, Inc. (NYSE:PDM) saw a decline in share price last week by 13.70%.
The self-managed real estate investment trust is one of the largest owners of Class A office properties in the U.S. Piedmont Office Realty Trust, Inc. (NYSE:PDM) has faced significant write-downs for two years. Additional write-downs are also expected in their Washington, D.C. properties. Their funds from operations (FFO) are taking a new hit because of substantial moveouts even during 2025. It is expected to last throughout 2026 as well. Though spaces are being rented out, the company lags in collecting property rents. The collection period lags from 18 to 24 months. It caused a fall in its value during the last week.
The dividend yield offered by Piedmont Office Realty Trust, Inc. (NYSE:PDM) stands at 6.84%. Though attractive, the dividend is paid with a payout ratio of 167.78%. This means that the company will likely finance its dividend payouts using debt. Since the interest rates are increasing, this may depreciate the value of an investment. However, 15 hedge fund portfolios from the Insider Monkey database held on to Piedmont in Q3 2024, indicating some level of institutional investor trust. Investors interested in the portfolio can purchase it on or before the ex-dividend date of February 21, 2025.
1. Ardmore Shipping Corporation (NYSE:ASC)
Dividend yield: 9.12%
Dividend payout ratio: 35.29%
Ex-Dividend Date: February 28, 2025
Number of Hedge Funds: 22
Ardmore Shipping Corporation (NYSE:ASC), a logistics company engaged in the seaborne transportation of petroleum products and chemicals, experienced a decline in its share price by 9.87%.
The decline comes despite the rise in shipping demands. After ships had been rerouted from going through the Suez Canal to going around the Cape of Good Hope, the average sailing distances increased. It, in turn, increased the demand for ships. The average sailing speeds are expected to keep decreasing, and hence, the supply would also reduce, upsetting the supply/demand balance. However, the investors are aware that this high demand will reduce once the Suez Canal routes are opened again, which is expected before the end of 2025. Fluctuating demand and potentially rising operational costs cause a decline in the stock’s value.
Ardmore Shipping Corporation (NYSE:ASC) offers a dividend yield of 9.12%, backed by the dividend payout ratio of 35.29%. With this, the company can pay dividends using one-third of its earnings. Additionally, the stock is part of 22 hedge fund portfolios tracked by Insider Monkey at the end of Q3 2024. This indicates a moderate level of institutional confidence in the company. The ex-dividend date of February 28, 2025, suggests that investors seeking the company’s dividend can buy the stocks before that date.
Overall Ardmore Shipping Corporation (NYSE:ASC) ranks first on our list of last week’s 10 worst dividend stocks. While we acknowledge the potential for ASC as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ASC but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.
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