10 Dividend Champions With Very Low Payout Ratios

 | Oct 06, 2013 04:15AM ET

Dividend Champions are stocks with a history of consecutive dividend hikes for 25 years or more without interruption. Only 105 stocks have managed this very important goal for long-term dividend growth investors. I like these stocks though some of them have a really high dividend payout ratio.

Today I'm screening for Dividend Champions with the lowest dividend payout ratios. Only 10 income growth firms have a payout ratio of less than 20 percent. Seven of them currently carry buy recommendations.

Helmerich & Payne (HP) has a market capitalization of $7.85 billion. The company employs 9,410 people, generates revenue of $3.151 billion and has a net income of $573.61 million. Helmerich & Payne’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1.277 billion. The EBITDA margin is 40.55 percent (the operating margin is 28.86 percent and the net profit margin 18.20 percent).

Financial Analysis: The total debt represents 4.11 percent of Helmerich & Payne’s assets and the total debt in relation to the equity amounts to 6.13 percent. Due to the financial situation, a return on equity of 16.08 percent was realized by Helmerich & Payne. Twelve trailing months earnings per share reached a value of $6.57. Last fiscal year, Helmerich & Payne paid $0.28 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 11.21, the P/S ratio is 2.43 and the P/B ratio is finally 1.98. The dividend yield amounts to 2.78 percent and the beta ratio has a value of 1.30.