critical financial information was printed daily in newspapers. Though many newspapers still print this information, most people find it easier (and faster) to get information on their stocks from financial websites. So back when financial information was a tedious and manual process what was considered relevant enough to warrant inclusion?
Obviously the reader would want basic information like the stock's ticker symbol, volume, closing price and possibly high and low price for the day or last 52 weeks. Dividend yield was another piece of useful information often presented. One of the more interesting pieces of information presented was the Price Earnings (P/E) Ratio.
The P/E Ratio is one of the oldest valuation metrics used. It is calculated as the market value per share divided by earnings per share (EPS). A high P/E ratio infers that investors expect strong future earnings growth, or the stock is over-valued. Conversely, a low P/E suggests limited future growth, or the stock is under-valued. Companies with limited growth projects to consume resources have historically been in a position to return large sums of cash to their shareholders as dividends and share buybacks.
This week, I screened my dividend growth stocks database for stocks with a single digit P/E/ Ratio and with a dividend yield above 2%. The results are presented below:
AXIS Capital Holdings Limited (AXS) provides various insurance and reinsurance products to insureds and reinsureds. It operates in two segments, Insurance and Reinsurance. The company has paid a cash dividend to shareholders every year since 2003 and has increased its dividend payments for 12 consecutive years.
Yield: 2.3% | P/E: 7.1
Aflac Incorporated (AFL) provides supplemental health and life insurance in Japan (78% of pretax operating profits) and the U.S. Products are marketed at work sites and help fill gaps in primary coverage. The company has paid a cash dividend to shareholders every year since 1973 and has increased its dividend payments for 33 consecutive years.
Yield: 2.5% | P/E: 9.9
Phillips 66 (PSX), spun off from ConocoPhillips in 2012, is one of the largest independent refiners and marketers of petroleum products in the U.S., with significant interests in the NGL gathering and processing and petrochemicals businesses. The company has paid a cash dividend to shareholders every year since 1934 and has increased its dividend payments for 14 consecutive years.
Yield: 2.0% | P/E: 9.5
Murphy Oil Corp. (MUR) is an international oil and gas company, with exploration and production interests worldwide, spun off its U.S. downstream operations in 2013. The company has paid a cash dividend to shareholders every year since 1961 and has increased its dividend payments for 20 consecutive years.
Yield: 2.9% | P/E: 9.9
Alliance Resource Partners LP (ARLP) produces and markets coal primarily to utilities and industrial users in the United States. It offers low-sulfur coal, medium-sulfur coal, and high-sulfur coal. The company has paid a cash dividend to shareholders every year since 1999 and has increased its dividend payments for 12 consecutive years.
Yield: 7.9% | P/E: 7.0
As with past screens, the data presented above is in its raw form. Some of the companies would be disqualified for poor dividend fundamentals. However some of the others may be worth additional due diligence.
My database, D4L-Data, is an Open Office spreadsheet containing more than 20 columns of information on the 250+ companies that I track. The data is sortable and has built-in buttons and macros to make it easy to use. Companies included in the list are those that have had a history of dividend growth. The D4L-Data spreadsheet is a part of D4L-Premium Services and is updated each Saturday for subscribers.
Full Disclosure: Long AFL in my Dividend growth Portfolio. See a list of all my dividend growth holdings here.
- What's More Powerful Than Compound Interest?
- Dividends vs. Stock Buybacks
- 5 Lessons Learned About Investing In Dividend Growth Stocks
- 6 High-Yielding Mega-Cap Stocks
- Dividend Investors Should Focus On Stocks, Not The Market
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