Shares of Diamond Offshore’s (NYSE: DO), 1.7% of OIH’s weight, are off nearly 3% today, a day after the company scrapped its special dividend policy.
Still, d ividend cuts, particularly in the case of Transocean, may not come as easily as some analysts and investors are thinking. In a note posted by Barron’s earlier today, Credit Suisse notes dividend increases and reductions for Switzerland-based companies, such as Transocean, must be approved by shareholders .
It is also worth noting that dividend action in the oil services industry is helping investors identify the strongest and weakest links. On the stronger side of the ledger are Schlumberger (NYSE: SLB) and National Oilwell Varco (NYSE: NOV). Schlumberger, the world’s largest oilfield services provider, recently announced a 25% dividend increase, bringing its payout to $2 per share per year. National Oilwell Varco’s payout is up more than fivefold since 2009. Those stocks combine for nearly 27% of OIH’s weight.
Market Vectors Oil Service ETF
