Results from the NASDAQ 100 Index calculated as of June 14, 2013 projecting gain results one year hence showed Apple, Inc. (AAPL) with a nearly 26% price upside for the coming year. Three other top yielding NASDAQ stocks showed double digit percentage one year price gains based on one year mean target prices set by brokerage analysts. Maxim Integrated Products (MXIM) showed a near 22% gain; Microchip Technology (MCHP) showed a 13% gain; Garmin Ltd. (GRMN) showed a 10.5% gain.
The chart above used one year mean target price set by brokerage analysts multiplied by the number of shares in a $1k investment to compare ten NASDAQ Index stocks showing the highest upside price potential into 2014 out of 20 selected by yield. The number of analysts providing price estimates was noted after the name for each stock. Three to nine analysts were considered optimal for a valid mean target price estimate.
Below, are the Arnold NASDAQ 100 Index top dog selections for June.
Dog Metrics Ranked NASDAQ 100 Stocks by Yield
Investor Glossary summarized dividend dog methodology thus: "...[I]nvented to find the 10 stocks of the 30-stock Dow Jones Industrial Average with the highest yield (dividend / price) and invest equally in each, [t]he Dow dividend theory also requires that you repeat this process once a year. This report presumed dividend dog methodology applied to any index and compared that index side by side with the Dow.
NASDAQ states, "The NASDAQ-100 Index includes 100 of the largest domestic and international non-financial securities listed on The Nasdaq Stock Market based on market capitalization. The Index reflects companies across major industry groups including computer hardware and software, telecommunications, retail/wholesale trade and biotechnology. It does not contain securities of financial companies including investment companies."
Just three of nine sectors were represented in the top ten NASDAQ dogs by yield as of June 14 per IndexARB.com data. Technology had seven firms in the top ten showing high forward looking yields. Vodafone (VOD) claimed the top spot. The other six technology firms in declining order were: Garmin ; Seagate Technology (STX); Intel (INTC); Microchip Technology ; Maxim Integrated Products CA Technologies (CA). The remaining two NASDAQ high yield sectors for June included two consumer goods representatives, Kraft Foods Group, Inc. KRFT), and Mattel (MAT). One service firm, Paychex (PAYX) filled out the top ten NASDAQ 100 dogs.
Dividend vs. Price Results Compared to Dow Dogs
Below is a graph of the relative strengths of the top ten NASDAQ 100 dogs by yield as of market close 6/14/2013 compared to those of the Dow. Historic projected annual dividend history from $1000 invested in each of the ten highest yielding stocks and the total single share prices of those ten stocks created the data points shown in green for price and blue for dividend.
Actionable Conclusion (1): NASDAQ 100 & Dow Dogs Both Bullish
NASDAQ 100 top May/June dividend payers continued a bullish price course set since November, 2012. Aggregate dividend from $10k invested in each of the top ten NASDAQ 100 stocks dropped at a 12% rate since November, while total single share price increased nearly 36.5% in that period. In the past month NASDAQ 100 top ten dog dividend dropped 3% while price rose 15.6%.
For the Dow dogs, meanwhile, projected annual dividend from $1k invested in each of the top ten dropped over 2.2% since April, while aggregate single share price popped up over 13.6%. Dow dogs increased their overbought condition as aggregate single share price of the ten exceeded projected annual dividend from $1k invested in each of the ten by over $198 or 53%.
Since NASDAQ 100 dogs are not the blue chip high quality equivalents of the Dow list, an additional gauge of upside potential was added to the simple high yield metric used to cull bargains.
Actionable Conclusion (2): Wall Street Wizard Wisdom Weighed to Calculate Over 8% Net Gain from Top 20 NASDAQ 100 Dogs In 2014
Top twenty dogs from the NASDAQ 100 index were graphed below to show relative strengths by dividend and price as of June 14, 2013 and those projected by analyst mean price target estimates to the same date in 2014.
A hypothetical $1000 investment in each equity was divided by the current share price to find the number of shares purchased. The shares number was then multiplied by projected annual per share dividend amounts to find the dividend return. Thereafter the analyst mean target price was used to gauge the stock price upsides and net gains including dividends less broker fees as of 2014.
Historic prices and actual dividends paid from $1000 invested in the ten highest yielding stocks and the aggregate single share prices of those twenty stocks divided by 2 created data points for 2013. Projections based on estimated increases in dividend amounts from $1000 invested in the twenty highest yielding stocks and aggregate one year analyst target share prices from Yahoo Finance divided by 2 created the 2014 data points green for price and blue for dividends.
Yahoo projected nearly a 3% lower dividend from $10K invested in this group while aggregate single share price was projected to increase over 6.4% in the coming year. The number of analysts contributing to the mean target price estimate for each stock was noted in the last column on the charts. Three to nine analysts was considered optimal for a valid estimate.
Actionable Conclusion (3): Analysts Forecast 10 NASDAQ 100 DiviDogs to Net 4.4% to 26.7% By June 2014 Led by Apple
Ten probable profit generating trades revealed by Yahoo Finance for 2014 were led by Apple's upside:
Apple, Inc. netted $267.39 based on dividends plus mean target price estimate from fifty analysts less broker fees;
Maxim Integrated Products netted $236.23 based on estimates from twenty-five analysts plus dividends less broker fees;
Microchip Technology netted $149.38 based on dividends plus mean target price estimate from fourteen analysts less broker fees;
Garmin netted $139.25 based on dividends plus mean target price estimate from seven analysts less broker fees;
Wynn Resorts (WYNN) netted $104.76 based on a mean target price estimate from twenty-four analysts combined with projected annual dividend less broker fees;
Mattel netted $96.53 based on dividends plus the mean of annual price estimates from ten analysts less broker fees;
Analog Devices (ADI) netted $82.34 based on a mean target price estimate from twenty-six analysts combined with projected annual dividend less broker fees;
KLA-Tencor (KLAC) netted $82.41 based on dividends plus a mean target price estimate by fifteen analysts less broker fees;
Vodafone netted $73.39 based on estimates from three analysts plus dividends less broker fees;
Cisco Systems (CSCO) netted $44.34, based on dividend plus mean target price estimates from thirty-five analysts less broker fees.
The average net gain in dividend and price was over 12.7% on $1k invested in each of these ten dogs.
The stocks listed above were suggested only as decent starting points for your index dog dividend stock purchase research process. These were not recommendations.
Seeking Alpha reader requests prompted this series of index-specific articles reporting dividend yield plus price upside results for twelve popular stock indices: Dow 30; S&P 500; S&P Aristocrats; Russell 50; NASDAQ; NYSE International 100; Mergent Dividend Achievers; Champions; Contenders; Challengers; Carnevale's Power 25; Carnevale's Super 29.
Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, recommendation or endorsement to buy or sell any security. Prices and returns on equities in this article except as noted are listed without consideration of fees, commissions, taxes, penalties, or interest payable due to purchasing, holding, or selling same.