Dividend income investors who tout rising yields should rethink their holdings in three companies.
VICI Properties (VICI) has slumped suddenly since June 17. The stock fell on worries that the sales of Caesar’s would cloud its outlook. Fertitta Entertainment agreed to buy Caesars Entertainment on May 28. It is paying $17.6 billion. That includes the assumption of around $12 billion in outstanding debt.
BCE announced last week that it would cut 690 jobs. Most cuts involve a voluntary separation package, which will add to BCE’s one-time costs. That follows a job cut of 4,800, or 9% of its workforce, announced in 2024. In 2023, it cut 1,300 jobs (3% of total at the time).
The telecom giant faces ongoing competition from Rogers (RCI) and Telus (TU). Additionally, telecom capital expenses limit the firm’s profit margin. Investors would rather hold suppliers that benefit from AI.
Cisco Systems (CSCO) is benefiting from the strong demand for AI. The single-day rally on May 14 is a level not seen since 2011. In Q3, Cisco posted a 12% Y/Y increase in revenue. It also cut 4,000 staff.
Investors should watch out for profit-taking in CSCO stock. After holding the stock for more than a decade, shareholders might prefer to hold a faster-growing hyperscaler firm like Nebius (NBIS). They might trade CoreWeave (CRWV) or SpaceX (SPCX) to harvest their volatility.
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