Dividend Yield | Feb 21, 2013 04:17AM ET
Dividend Contenders are stocks that raised dividend payments over a period of 10-25 years without a break. Most of them have a huge potential to become a solid Dividend Champion.
The advantage of Contenders is that they are not the main focus of many investors because of their smaller capitalization or lower media presence. As a result, we can often discover some high quality dividend growth stocks at a lower price.
I screened all 189 Contenders and selected those with an expected earnings growth of more than 10 percent as well as a low forward P/E ratio of less than 15. Exactly 20 companies fulfilled my criteria of which seventeen are currently recommended to buy.
Norfolk Southern (NSC) has a market capitalization of $22.69 billion. The company employs 30,329 people, generates revenue of $11.040 billion and has a net income of $1.749 billion. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $4.040 billion. The EBITDA margin is 36.59 percent (the operating margin is 28.30 percent and the net profit margin 15.84 percent).
Financial Analysis: The total debt represents 28.61 percent of the company’s assets and the total debt in relation to the equity amounts to 88.95 percent. Due to the financial situation, a return on equity of 17.69 percent was realized. Twelve trailing months earnings per share reached a value of $5.36. Last fiscal year, the company paid $1.94 in the form of dividends to shareholders.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 13.49, the P/S ratio is 2.09 and the P/B ratio is finally 2.36. The dividend yield amounts to 2.73 percent and the beta ratio has a value of 1.13.
Here is the full table with some fundamentals (TTM):
Disclosure: I am long UTX, QCOM. 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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