As the tech market starts to come back, investors are on the lookout for dividend stocks to sell to keep their porfolios clean.

Whether for passive income or building generational wealth, everyone likes a dividend.Stocks with high dividends have kind of been neglected in the tech-mania that’s been taking over the stock market. But not every dividend is created equal.

Some dividends will likely get cut before you ever make back your investment. Be aware of which dividend stocks to sell before that happens.

The 21st century has brought disruptive tech to every corner of the economy. And from energy to real estate to communications, there are many high-dividend stocks to sell before they get pushed out of contention.

Falling revenue and rising costs can force a dividend to be cut, pushing the stock price down even further. At that point, a stock you bought for its dividend can seem all but worthless.

While many investors flee to dividend safety during uncertain times, here are three dividend stocks to sell instead. Already being disrupted by technology, they’ll likely have even further to fall before too long. When that happens, be sure you aren’t left holding the bag.

XRX Xerox $14.51
ARLP Alliance Resource Partners $20.72
BXP Boston Properties $50.96

 Xerox (XRX)

Xerox (NASDAQ:XRX) was a declining business even before the COVID-19 pandemic. Their revenue declined by about $500 million a year from 2015 to 2019.

Xerox specializes in the tools of physical communication: copiers and printers. We’re now a few decades into the digital age, and it’s never been easier to talk electronically.

Xerox made $7.1 billion dollars of revenue in 2022. But that’s around 2 billion less than they were making in 2019. While other companies have rebounded from the Pandemic, Xerox has continued its decline.

Since millions of Americans are still working from home, they’ll be communicated electronically rather than physically. That means less demand for Xerox’s core business.

On top of revenue, Xerox has a debt problem. With about $3.75 billion in debt, and $1 billion in cash and cash equivalents, Xerox is in a deep hole. That’s a hole they’re unlikely to dig their way out of if revenue remains sluggish. A higher interest rate environment means it will be more expensive to keep servicing Xerox’s debt.

Xerox is a 20th century company in a 21st century world. Their 6.8% dividend doesn’t make them a good buy, it’s just the first thing they’ll need to cut as they drift towards irrelevance.

Alliance Resource Partners (ARLP)

Coal is dying, and you don’t want to be stuck with the bag when it’s dead. Alliance Resource Partners (NASDAQ:ARLP) is a coal company facing significant headwinds in today’s market.

Even a coal-friendly president like Donald Trump couldn’t reverse the trend. With the Biden administration proposing tough rules for coal power plants, and with many countries pushing for decarbonization and the elimination of coal altogether, Alliance’s future prospects are bleak.

The Biden administration has repeatedly expressed its desire to end America’s coal use.

Alliance’s price to earnings ratio of 4 sounds like a bargain. But it’s actually a warning. Smart investors know that the company’s future earnings are in jeopardy from legislation.

Alliance’s dividend of 13% may seem like a steal. But it’s actually a red flag because 13% is not sustainable and leaves little room for reinvestment. And as new environmental rules continue to squeeze out coal, that dividend will probably be cut.

As decarbonization policies continue to gain traction, Alliance’s business model is becoming increasingly outdated. And the large dividend is leaving little money left for Alliance to take part in the energy market of the future.

The bottom line is this: ARLP may sound like a dividend king, but with the world’s push for less carbon, its reign is coming to an end.

Boston Properties BXP

Boston Properties (NYSE:BXP) is a Real Estate Investment Trust (REIT). Despite the name, it owns properties in many cities.

Although the pandemic has faded from view, American workers aren’t returning to the office like their worldwide counterparts. The company itself admits vacancy rates will continue to rise in 2023. That’s bad news for a company with much more debt than equity.

As with many office REITs, the pandemic hit Boston Properties hard. But Boston Properties is being hit even harder by the post-pandemic environment. Its large debt load includes a considerable amount of variable interest rate debt. As interest rates rise, that debt becomes much more expensive.

Boston Properties’ dividend of 7.5% may seem amazing. But note that the company has lost more than 50% of its value in the last year. They can always lose another 50% and another 50% after that. Chasing dividends from a struggling REIT isn’t likely to be a winning move.

The trends that brought Boston Properties to this point are unlikely to reverse. Work from home is becoming entrenched, and a desirable quality for American workers. The Federal Reserve remains hawkish, and interest rates are unlikely to be cut. As technology continues to make the modern office obsolete, the modern office REIT will go along with it.

On the date of publication, John Blankenhorn did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

John Blankenhorn is a neuroscientist at Emory University. He has significant experience in biochemistry, biotechnology and pharmaceutical research.

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