Whirlpool’s Dividend Collapse Is a Warning for These 3 High-Yield Stocks

Quick Read

• Clorox pays out more than it earns, with a 103% payout ratio and free cash flow of $405M covering only two-thirds of its $601M annual dividend cost.

• General Mills’ 7% yield is largely a mirage, given that its trailing GAAP EPS is negative after $1.75 billion in impairments and Q1 free cash flow fell $123M short of dividends paid.

• Whirlpool slashed its dividend from $1.75 to $0.90 per quarter, then suspended it entirely, while shares collapsed 61%, making it a textbook dividend trap.

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Whirlpool (NYSE:WHR) shows how fast a reliable payout can disappear. The appliance maker paid $1.75 per share per quarter through early 2025, then cut it to $0.90 and suspended its common dividend in the first quarter of 2026 to prioritize deleveraging. The shares have fallen 61.19% over the past year. Red flags appeared early. In 2025, operating cash flow of $481 million barely exceeded $389 million in capital spending, leaving almost nothing for the $299 million dividend. A high yield matters only if the company can keep paying it.

Here is the test: a dividend becomes unsustainable when it costs more than the company earns, when free cash flow (operating cash flow minus capital spending) can’t cover it, or when rising debt is filling the gap. All three stocks below are ordinary corporations, so earnings per share and free cash flow are the right measures. (We listed seven warning signs that a big yield is about to get slashed in our dividend trap guide here: Dividend Traps.)

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Clorox: A Dividend Aristocrat Paying Out More Than It Earns

Clorox (NYSE:CLX) recently raised its quarterly payout from $1.24 to $1.25 per share, or $5 per year. At $86.39, that is a yield of about 5.8%. The shares are down 23.02% over the past year, so part of that yield comes from the falling price rather than from dividend growth.