Dividend Yield | Aug 28, 2013 06:02AM ET
Today I'm filtering for good potential dividend growth with an acceptable initial dividend yield. In addition I'm looking for stocks with low or no long-term debt. This increases the chances for further big dividend hikes or accelerated growth.
Only a low leveraged company has more flexibility to grow sales and income much more easily. Let’s take a look at an acknowledged dividend growth stock category, Dividend Challengers.
Thirteen stocks from the Dividend Challengers list (stocks with annual, dividend growth for between 5 to 10 consecutive years) fulfilled my above mentioned criteria. One stock has a high yield close to the double-digit range and five stocks got a buy or better rating by brokerage firms. Most of the companies from the screening results are small caps; eight have a market capitalization under USD 2 billion.
China Mobile (CHL) has a market capitalization of $214.35 billion. The company employs 188,000 people, generates revenue of $91.567 billion and has a net income of $21.140 billion. China Mobile’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $41.543 billion. The EBITDA margin is 45.37 percent (the operating margin is 26.86 percent and the net profit margin 23.09 percent).
Financial Analysis: The total debt represents 0.48 percent of China Mobile’s assets and the total debt in relation to the equity amounts to 0.70 percent. Due to the financial situation, a return on equity of 18.84 percent was realized by China Mobile. Twelve trailing months earnings per share reached a value of $5.23. Last fiscal year, China Mobile paid $2.79 in the form of dividends to shareholders.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 10.20, the P/S ratio is 2.35 and the P/B ratio is finally 1.81. The dividend yield amounts to 4.12 percent and the beta ratio has a value of 0.35.
Here is the full table with some fundamentals (TTM):
Disclosure: I am long ACN, CHL, SNN. I receive no compensation to write about these specific stocks, sector or theme. I don't plan to increase or decrease positions or obligations within the next 72 hours.
For the other stocks: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I receive no compensation to write about any specific stock, sector or theme.
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.