High Yielding Dividend Achievers: Cheap Income Growth Stocks
Dividend Yield | Sep 22, 2013 05:39AM ET
High yielding stocks in a low interest environment is the only solution to hedge your assets against inflation. But high yielding stocks are rare when the Fed keeps its leading interest rates close to zero percent and pulls the market loan rates via bond purchases to the ground.
I stopped purchasing stocks for my own accounts since the beginning of the year. It was a wrong decision because equities are now more expensive. It’s very hard to discover good stocks with solid dividend growth and high yields. I am referring to yields over 3 percent and not the big risks, including stocks with yields far above 5 percent.
Today I would like to screen the High-Dividend Achievers Index by stocks with inflation adequate yields and low price-to-earnings ratios. I prefer a ratio of the forward P/E below 15. Only 17 of 50 index members fulfilled these criteria. You can find a detailed list of these stocks attached.
Two High-Yields are part of the results and five received a current buy or better rating. Banks and utilities are the dominating industries on the list.
Old Republic (ORI) has a market capitalization of $3.93 billion. The company employs 7,800 people, generates revenue of $4.970 billion and has a net income of $-68.80 million. Old Republic’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $-68.50 million. The EBITDA margin is -1.38 percent (the operating margin is -2.59 percent and the net profit margin -1.38 percent).
Financial Analysis: The total debt represents 3.53 percent of Old Republic’s assets and the total debt in relation to the equity amounts to 15.93 percent. Due to the financial situation, a return on equity of -1.86 percent was realized by Old Republic. Twelve trailing months earnings per share reached a value of $0.72. Last fiscal year, Old Republic paid $0.71 in the form of dividends to shareholders. 5-Year earnings are expected to grow by 10 percent yearly.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 21.05, the P/S ratio is 0.78 and the P/B ratio is finally 1.07. The dividend yield amounts to 4.85 percent and the beta ratio has a value of 0.91.
ConocoPhillips (COP) has a market capitalization of $86.83 billion. The company employs 17,500 people, generates revenue of $62.004 billion and has a net income of $7.481 billion. ConocoPhillips’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $22.309 billion. The EBITDA margin is 35.98 percent (the operating margin is 24.87 percent and the net profit margin 12.07 percent).
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Financial Analysis: The total debt represents 18.55 percent of ConocoPhillips’s assets and the total debt in relation to the equity amounts to 45.27 percent. Due to the financial situation, a return on equity of 13.09 percent was realized by ConocoPhillips. Twelve trailing months earnings per share reached a value of $6.17. Last fiscal year, ConocoPhillips paid $2.64 in the form of dividends to shareholders. 5-Year earnings of COP are expected to grow by 8.48 percent yearly.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 11.50, the P/S ratio is 1.40 and the P/B ratio is finally 1.81. The dividend yield amounts to 3.89 percent and the beta ratio has a value of 1.14.
Tompkins Financial (TMP) has a market capitalization of $644.27 million. The company employs 813 people, generates revenue of $158.36 million and has a net income of $31.42 million. Tompkins Financial’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $71.35 million. The EBITDA margin is 45.06 percent (the operating margin is 22.50 percent and the net profit margin 16.63 percent).
Financial Analysis: The total debt represents 5.74 percent of Tompkins Financial’s assets and the total debt in relation to the equity amounts to 63.11 percent. Due to the financial situation, a return on equity of 8.45 percent was realized by Tompkins Financial. Twelve trailing months earnings per share reached a value of $2.58. Last fiscal year, Tompkins Financial paid $1.46 in the form of dividends to shareholders. 5-Year earnings of TMP are expected to grow by 8 percent yearly.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 17.31, the P/S ratio is 3.27 and the P/B ratio is finally 1.39. The dividend yield amounts to 3.55 percent and the beta ratio has a value of 0.54.
Meredith (MDP) has a market capitalization of $2.05 billion. The company employs 3,250 people, generates revenue of $1.471 billion and has a net income of $123.65 million. Meredith’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $274.44 million. The EBITDA margin is 18.65 percent (the operating margin is 14.33 percent and the net profit margin 8.40 percent).
Financial Analysis: The total debt represents 16.35 percent of Meredith’s assets and the total debt in relation to the equity amounts to 40.97 percent. Due to the financial situation, a return on equity of 14.97 percent was realized by Meredith. Twelve trailing months earnings per share reached a value of $2.74. Last fiscal year, Meredith paid $1.58 in the form of dividends to shareholders. 5-Year earnings of MDP are expected to grow by 15 percent yearly.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 16.79, the P/S ratio is 1.13 and the P/B ratio is finally 2.40. The dividend yield amounts to 3.54 percent and the beta ratio has a value of 1.61.
Take a closer look at the full list of cheap stocks from the High-Yield Dividend Achievers Index . The average P/E ratio amounts to 16.09 and forward P/E ratio is 13.32. The dividend yield has a value of 4.22 percent. Price to book ratio is 6.38 and price to sales ratio 1.84. The operating margin amounts to 22.13 percent and the beta ratio is 0.71. Stocks from the list have an average debt to equity ratio of 1.55. -
Here is the full table with some fundamentals (TTM):
Related Stock Ticker Symbols:
MO, T, PPL, SO, ORI, AVA, ED, SCG, PBI, COP, AROW, UVV, UNS, LMT,
MDP, TMP, CTBI
Disclosure: I am long MO, LMT. 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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