Dividends Up To 20% Wall Street Says You Should Sell

A contrarian note flags four “hated” high-yield ideas—National Storage Affiliates (NSA, 7.9%), Alexander’s (ALX, 8.5%), Robert Half (RHI, 9.0%) and Cricut (CRCT, 20.6%)—but highlights that each yield is underpinned by material near-term risks: NSA has suffered a 20% share pullback amid industry weakness, tightened payout coverage (midpoint FFO $2.20 vs. $2.28 dividends) and trades at ~13x FFO; ALX is highly concentrated (Bloomberg ~60% of revenues), missed repayment on a $300m loan on 731 Lexington and is discussing restructuring while dividend payouts have historically exceeded FFO and shares trade >16x 2025 FFO; Robert Half’s stock has collapsed from pandemic-era peaks, Q4 guidance disappointed, earnings are set to fall ~45% to $1.34 in the current year while the company pays ~$2.28 annually, raising dividend-coverage concerns despite management downplaying AI disruption; and Cricut’s very high yield is driven largely by special distributions that aren’t sustainable, even as near-term profit and revenue outlooks are mixed. For income-focused institutional investors the common takeaway is attractive headline yields but meaningful payout sustainability, concentration, leverage and secular/cyclical downside that make these names high-risk turnaround or value-trap candidates unless macro or company fundamentals materially improve.

Analysis

A contrarian income note highlights four high-yield names—National Storage Affiliates (NSA, 7.9%), Alexander’s (ALX, 8.5%), Robert Half (RHI, 9.0%) and Cricut (CRCT, 20.6%)—each with material near-term risks despite attractive headlines. NSA has suffered a roughly 20% share pullback, reports lower earnings, core FFO and occupancy, trades near 13x FFO and projects midpoint FFO of $2.20 against $2.28 in dividends, tightening payout coverage. ALX is highly concentrated (Bloomberg tenant ~60% of revenues), missed repayment on a $300m loan encumbering 731 Lexington and is in restructuring talks while historical dividends have exceeded FFO (2023: $18 paid vs $15.80 FFO; 2024: $18 vs $15.19; 2025: $13.50 paid vs $9.84 FFO through three quarters) and trades >16x 2025 annualized FFO.

RHI’s share price is down ~80% from 2022 peaks and ~60% YTD, Q4 guidance disappointed, ADP cited ~11,000 job losses per week and company profits are expected to fall ~45% to $1.34 this year versus a $2.28 annual dividend, creating clear coverage risk despite management downplaying AI disruption. CRCT’s 20.6% yield is driven largely by special distributions (≈16 percentage points), management forecasts >20% profit growth in 2025 but flat-to-declining revenues and a sharp 2026 profit drop are projected, and every analyst covering the stock is negative.

Headline yields mask sustainability, concentration, leverage and secular/cyclical risks: self-storage sector weakness, loan restructuring at ALX, dividend-over-FFO dynamics at ALX and NSA, secular staffing uncertainty at RHI, and one-off special distributions at CRCT. Investors should prioritize dividend coverage metrics, upcoming corporate actions (loan outcomes, special distribution policy, Q4/holiday season results) and adjust position sizing accordingly.

Key Decisions for Investors

• Do not initiate meaningful long positions solely for headline yield; require clear FFO/dividend coverage or a credible path to restoring coverage before adding exposure to NSA, ALX or RHI
• Treat ALX as a capital-structure and concentration risk: avoid or size very small until the 731 Lexington loan restructuring resolves and FFO/dividend alignment is demonstrated
• For RHI, prefer wait-and-see or hedged exposure—management’s comments on AI are inconclusive, but earnings are forecast to drop ~45% so a dividend cut or equity downside remains a realistic catalyst
• Consider CRCT only as a short-term special-distribution play with strict position limits and a hedge around holiday-quarter results given that ~16 percentage points of its yield stem from nonrecurring payments
• Monitor short-term catalysts (NSA same-store occupancy/NOI, ALX lender negotiations, RHI Q4 and hiring trends, CRCT holiday sales and special-distribution announcements) and adjust positions quickly if dividend coverage deteriorates