Dividend Yield | Apr 14, 2013 07:17AM ET
When I buy stocks I always check the risk fundamentals of the company. Besides the market capitalization, the beta ratio is meaningful. The ratio shows investors how volatile a stock is compared to the overall market. A beta value of 1.2 means the stock has a 20 percent higher volatility than the market. I use this tool to identify the underlying risks of a business model. It’s not perfect, but a good first step toward evaluating a stock's risk situation.
Today I'm screening for the safest basic material stocks. These are my criteria:
- Market Capitalization over USD 10 billion - Beta ratio below 1
Below are the 20 best yielding stocks I found with this filter. 14 have a current buy or better recommendation and 5 are high-yields. Oil and gas companies are the dominating category.
Kinder Morgan Energy Partners (KMP) has a market capitalization of $33.68 billion. The company employs 10,685 people, generates revenue of $8.642 billion and has a net income of $2.025 billion. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $3.428 billion. The EBITDA margin is 39.67 percent (the operating margin is 27.08 percent and the net profit margin 23.43 percent).
Financial Analysis: The total debt represents 54.13 percent of the company’s assets and the total debt in relation to the equity amounts to 153.43 percent. Due to the financial situation, a return on equity of 7.34 percent was realized. Twelve trailing months earnings per share reached a value of $1.65. Last fiscal year, the company paid $4.98 in the form of dividends to shareholders.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 54.83, the P/S ratio is 3.96 and the P/B ratio is finally 3.98. The dividend yield amounts to 5.72 percent and the beta ratio has a value of 0.40.
Here is the full table with some fundamentals (TTM):
Disclosure: I am long PX. 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.
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