14 Dividend Contenders With Gaining Earnings Growth Momentum

 | Apr 09, 2012 05:29AM ET

Dividend Contenders are growth stocks with a huge reliability in terms of dividend payments. They raised distributions over a period of 10-24 consecutive years. 166 companies with such an impressive dividend growth are tradable at the markets.

In order to find some opportunities, I screened the sector by stocks with an earnings growth of more than ten percent (past five years). In order to catch up only those stocks with a gaining earnings momentum, I observed only those stocks with a quarter over quarter sales and earnings per share growth of more than fifteen percent. Exactly fourteen companies fulfilled these criteria of which two are high yields; nine are recommended to buy.

Nu Skin Enterprises (NYSE:NUS) has a market capitalization of $3.59 billion. The company employs 3,420 people, generates revenues of $1,743.99 million and has a net income of $153.33 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $266.54 million. Because of these figures, the EBITDA margin is 15.28 percent (operating margin 13.40 percent and the net profit margin finally 8.79 percent).

Financial Analysis:
The total debt representing 13.78 percent of the company’s assets and the total debt in relation to the equity amounts to 23.78 percent. Due to the financial situation, a return on equity of 29.33 percent was realized. Twelve trailing months earnings per share reached a value of $2.38. Last fiscal year, the company paid $0.59 in form of dividends to shareholders. NUS raised dividends for 12 consecutive years. Sales are up 23.45 percent quarter over quarter and earnings 31.63 percent.

Market Valuation:
Here are the price ratios of the company: The P/E ratio is 23.91, P/S ratio 2.06 and P/B ratio 6.16. Dividend Yield: 1.41 percent. The beta ratio is 1.21.