Best Technology Dividend Stocks For 2013

 | Dec 07, 2012 04:01AM ET

Today, I'd like to focus on technology, a sector that is very underweighted in my private portfolio. I am looking for growth stocks with cheap price ratios and high-quality margins. That’s why I screened the technology sector by stocks with a forward P/E ratio of less than 15,sales growth over the past five years of more than 10 percent as well as an operating margin above 10 percent. In order to exclude low capitalized stocks, I looked for stocks with a market capitalization of over USD 10 billion.

Exactly thirteen stocks fulfilled these criteria of which nine technology stocks pay dividends – eight have a buy or better recommendation.

Telefonica Brasil (VIV) has a market capitalization of $24.46 billion. The company employs 21,542 people, generates revenue of $13.743 billion and has a net income of $2.058 billion. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $4.898 billion. The EBITDA margin is 35.65 percent (the operating margin is 19.90 percent and the net profit margin 14.98 percent).

Financial Analysis: The total debt represents 9.51 percent of the company’s assets and the total debt in relation to the equity amounts to 14.37 percent. Due to the financial situation, a return on equity of 15.84 percent was realized. Twelve trailing months earnings per share reached a value of $1.23. Last fiscal year, the company paid $2.48 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 17.66, the P/S ratio is 1.67 and the P/B ratio is finally 1.16. The dividend yield amounts to 8.46 percent and the beta ratio has a value of 0.59.