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Comprehensive screens and creating ranking systems are one of my favorite starting points for identifying potential investments. While I typically focus on Dividend Champions (stocks that have raised dividends for 25+ years) or high yield stocks with price momentum, this screen began with the entire universe of US stocks, excluding over-the-counter and ADRs.

Using Stockscreen123, I required stocks to have:

  • yield > 2%,
  • payout ratio < 100%,
  • positive dividend growth over the past 1, 3, and 5 years,
  • debt/equity ratio < 100%
  • trailing and projected PE > 0
153 stocks remain. Next, I ranked each stock based on its yield, payout ratio, 1 year dividend growth and 5 year dividend growth. I provide step-by-step instructions for creating your own ranking system using a spreadsheet here and I used the same method for ranking the stocks below.
The following stocks remain and the list also shows some of the dangers in relying on just screen results. For example, Strayer Education (STRA) has struggled mightily in recent months as the private education industry faces legal issues and the potential for increased government regulation.
Also, Life Partners (LPHI), which purchases life insurance policies at a discount and resells them to investors, is under SEC investigation over life-span data calculations. LPHI could potentially faces fines, penalties, and, if revised life expectancy data causes lowered return expectations, it could be difficult for them to attract clients. (As an aside, this information on LPHI should have been disclosed in a recent article of mine and regrettably it was omitted).
Issues such as the ones highlighted above could jeopardize the future dividend growth of both companies. Thus, tread carefully before jumping into any of these stocks based on current and historical data because recent and material negative news may not yet be reflected in quarterly data.

With that being said, I believe there are several viable dividend candidates in the list below. The top 20 results, in order, are below:
Ticker Name MktCap Yield Yield rank Pay Ratio TTM Payout Rank
BLK BlackRock, Inc. 35611.74 2.96 64 15.78 5
STRA Strayer Education, Inc. 1816.48 2.92 68 33.9 47
ESV ENSCO PLC 8056.06 2.49 102 28.46 24
SBSI Southside Bancshares, Inc. 325.1 3.27 45 30.73 39
LPHI Life Partners Holdings, Inc. 135.17 11.03 1 64.91 132
COP ConocoPhillips 107195 3.52 36 28.49 25
DRI Darden Restaurants, Inc. 6413 2.76 77 36.06 58
INTC Intel Corporation 110747.8 3.59 34 30.54 37
VLGEA Village Super Market, Inc. 389.31 3.45 38 48.66 101
SAFT Safety Insurance Group, Inc. 682.12 4.44 15 44.09 86
TWGP Tower Group, Inc. 980.31 2.12 138 14.03 1
ACU Acme United Corporation 28.86 2.55 96 20.99 10
RBCAA Republic Bancorp, Inc. KY 383.16 3.13 51 17.91 6
THG The Hanover Insurance Group, 2055.57 2.42 109 30.81 40
LLL L-3 Communications Holdings, 9047.92 2.3 119 19.37 9
BNCN BNC Bancorp 71.43 2.53 97 14.25 2
HAS Hasbro, Inc. 6309.34 2.61 91 34.91 53
WMT Wal-Mart Stores, Inc. 185437.4 2.8 74 28.64 26
HRS Harris Corporation 5661.08 2.26 122 19.17 7
RTN Raytheon Company 18362.38 2.94 66 30.6 38
Disclosure: No positions



Source: 20 Dividend Stocks Yielding 2% or More With Positive Dividend Growth