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9/29/2014

3 Fairly Priced High-Margin Stocks Warren Buffett Would Like

Everybody wants to make money, big money over the long-haul. You put money into a stock and get twice of this amount back in 10 years. That's great and I have often invested into stocks that doubled in a decade easily.

Today I like to come back to return. It's very important to see that the company makes good profits on its annual sales. The higher the margin, net or operational, the better is the market dominance of the firm.

I like companies with high margins, Google and Apple have unbelievable high margins. You might wonder but they have no direct competition and can charge customers each price they want, there is no alternative and if you need those products or you think you must have them, you must pay the bill.


Warren Buffett is also a great investor who invested into stocks that produce high returns on invested capital. It's the guarantee that the firm makes internal revenues which could be used to pay investors.

I ran a screen that searched for the accompanying criteria: 


Average returns on invested capital > 12% over the last 5 years

- Current return on invested capital > its 5-year average 


I sifted further for organizations with a long history of solid sales and profit improvements combined with robust, and enhancing, net revenues that are not profoundly leveraged by debt. I added the accompanying extra criteria: 
- Average sales growth > 10% over the last 5 years
- Average EPS growth > 10% over the last 5 years
- Average operating profit margin > 10% over the last 5 years
- Current operating profit margin > its 5-year average
3 companies jumped on top of my screen. Very informative...

9/28/2014

Yields Of The Dividend Aristocrats | 12 Cheapest Stock Of The Index

Today I've attached a list of the yields from the Dividend Aristocrats for you. You can also find the payout ratios in this table. It's very informative in my view and I use this overview too in order to get a feeling about the pricing of the market.

Dividend Aristocrats are stocks that have increased dividend payments over a period of 25 consecutive years without a break. That's a top value and around 100+companies could achieve this goal.

Standard & Poor's increases the restrictions and cut the list to 42 members. Well not all stocks are good from the list but you can find there some value player. Just take a look!
Only 12 companies yield over 3 percent. Not bad for a low interest environment. The bond market offers 1.56 percent and has also default risks.

The top yielding stocks also slow grower full of debt. Which stock do you like or own from the list? Let me know your thoughts and write a comment. Thank you.



These are my main thoughts to the Dividend Aristocrats list:

- When we look at the highest yielding stocks with yields over 3 percent, we see that only 3 companies have a low forward P/E.

- Stocks with a lower yield are much cheaper. 9 companies with yields less than 2 percent have a forward P/E under 15.

- Low yielding stocks pay out less of it's annual earnings and might be reinvest more money into growth.

Also read this: 25 Of The Most Attractive Dividend Stocks

These are the 12 cheapest Dividend Aristocrats:


Company
Ticker
Mcap
P/E
P/B
P/S
Yield
AT&T, Inc.
T
182.96B
10.38
1.99
1.40
5.22%
Consolidated Edison, Inc.
16.50B
13.04
1.33
1.26
4.47%
Chevron Corporation
230.66B
11.59
1.49
1.06
3.52%
Exxon Mobil Corporation
406.98B
12.16
2.26
0.96
2.89%
Bemis Company, Inc.
3.80B
17.37
2.25
0.77
2.84%
AFLAC Inc.
26.50B
9.24
1.51
1.14
2.53%
Wal-Mart Stores Inc.
246.49B
16.00
3.18
0.51
2.51%
Stanley Black & Decker, Inc.
14.10B
23.14
2.00
1.26
2.31%
The Chubb Corporation
21.98B
11.19
1.36
1.58
2.19%
Medtronic, Inc.
62.04B
21.40
3.27
3.61
1.93%
Archer-Daniels-Midland Company
32.84B
20.43
1.65
0.37
1.89%
Franklin Resources Inc.
34.39B
15.41
3.04
4.13
0.87%


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9/26/2014

My 6 Favorite Dividend Growth And Share Buyback Stocks Of The Week

I've traveled last week which was one of the reasons why I haven’t made a clear post on this blog during the past week. I hope you are not worried about this.

Today I've compiled the latest dividend growth stocks and share buyback announcements. Twelve companies have released a share buyback program but only Lockheed Martin was the company with significant influence.

The military provider to the U.S. Government plans to buy additional $2 billion in own shares in the future. That's good news for shareholders and those will also receive more money by dividends. Lockheed also boosted its dividend payments by 12.78 percent. The new yield will hit the 3.3 percent level.

On the dividend growth side, only 14 companies or funds/trusts announced to pay higher dividends. The biggest company was Lockheed Martin followed by the electric utility stock OGE Energy.

In my view there were no interesting companies on the attached list. For sure you need a second check but for my own asset allocation, which excluded highly cyclical stocks and financials/banks/trusts etc...The research effort was very small for me.

What do you think from the latest dividend grower and share repurchaser? Do you like them or do you own one of them? Please let me known by leaving a little comment on this blog. Thank you for reading my blog.

My favorite Dividend Grower and Share Repurchaser 
of the recent week are...

9/23/2014

8 High-Return Creating Stocks

When you invest in dividend stocks you need also look at internal return rates. The most popular ratios are return on equity and return on investment.

A company that has a big return on equity and also low debt ratios means that the high ratio was not created by taking debt and boosting earnings. Great for us investors; we own a piece of a high income generating company.

If the company can scale up its sales by taking more debt and issuing new shares, our return could boost. That's also one reason why I look at low debt with good return on equity ratios. If the company also do stock buybacks and hiked dividends, great!

My experience is that no companies fulfill everything. It's no shame when a company suffers and do not meet every optimum value. Each business is volatile and risky.

I've tried to create a screen, based on some return figures. Below are my 8 favorites. At the end of this article, you can find a list with 16 additional stocks.

These are my main criteria:
- Midcap+
- Forward P/E under 15
- Operating Margin over 15 percent
- Debt-to-equity under 1
- Return on Equity 15%+
- Payout half of profits
- Mid-digit Earnigns growth forecasts

8 high return creating stocks, low debt and price ratios included are...

9/21/2014

16 Stocks Hiked Dividends In The Past Week

What a Week! Scotland vote no and belong further to the United Kingdom but more important to me were the dividend growth announcements of the week which I cover.

I love dividend growth stocks and made a significant amount of money with them as a long-term orientated investor. My strategy is somewhat between growth and value. I’m a fan of Warren Buffett but I have my own experience and strategy.

Within the past week, sixteen stocks hiked dividends. Big names like Microsoft and McDonalds are part of the list.

Below is a small overview of my favorites by biggest market capitalization. At the end of this article, you will also find a full list of all dividend grower and buyback announcements.

Dividend growth and share buybacks are two essential ways to give shareholders directly and indirect more money into their pocket.

It also show in most cases that the firm is doing well and like to share their success with the owner of the company.

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