Seeking Alpha
Profile| Send Message|
( followers)  

It is important for investors to select stocks with more than one interesting buy criteria. Interesting stocks must have good operational and profitability ratios, strong growth figures. Finally, they must be attractively valued. I have tried to summarize these requirements and screened a dividend list (from low-yield to high-yield paying stocks) of 30 stocks with interesting performance and valuation figures. Stocks from the sheet are mid and large caps (market capitalization of more than USD 1 billion) with double digit long-term earnings growth rates (8 percent minimum for revenue growth and more than 10 percent earnings per share growth). Additional criteria are the return on investment for the capital efficiency and operating margin in order to indicate the profitability of the company. As pricing criteria, I decided to choose the price-to- earnings ratio, dividend yield and price to book ratio. Here are details of my requirements:

Market capitalization: > 1 Billion

Price/Earnings Ratio:> 0 < 100

Dividend Yield: > 2 < 20

Return on investment: > 10 < 100

Operating Margin: > 10 < 100

10 Year Revenue Growth: > 8 < 200

10 Year EPS Growth: > 10 < 100

Here are my most promising stocks from the list:

1. Alliance Resource Partners (NASDAQ:ARLP) is acting within the industrial metals and minerals industry. The company has a market capitalization of $2.8 billion, generates revenue in an amount of $1.7 billion and a net income of $261.3 million. It follows Price/Earnings ratio is 10.4, Price/Sales 1.65 and Price/Book ratio 3.79. Additional dividend information:

Dividend Yield: 4.8 percent

Years of Consecutive Dividend Increasing: 8 Years

5-Year Dividend Growth: 14.3 percent

Dividends Since 1999.

2. Amgen (NASDAQ:AMGN) is acting within the healthcare/biotech industry. The company has a market capitalization of $50.9 billion, generates revenue in an amount of $15.2 billion and a net income of $4.6 billion. It follows Price/Earnings ratio is 11.4, Price/Sales 3.3 and Price/Book ratio 2.1. Additional dividend information:

Dividend Yield: 2.1 percent

Years of Consecutive Dividend Increasing: 0 Years

5-Year Dividend Growth: 0 percent

Dividends Since 1997.

3. BHP Billiton (NYSE:BBL) is acting within the industrial metals and minerals industry. The company has a market capitalization of $200.1 billion, generates revenues in an amount of $62.4 billion and a net income of $17.1 Billion. Price/Earnings ratio is 12.3, Price/Sales 3.6 and Price/Book ratio 4.3. Additional dividend information:

Dividend Yield: 2.4 percent

Years of Consecutive Dividend Increasing: 8 Years

5-Year Dividend Growth: 24.76 percent

Dividends Since 2002.

Take a closer look at the full list. The average dividend yield amounts to 3.48 percent while the average price-to-earnings ratio is 14.49. Stocks grew with 17.35 percent in revenue and 18.23 percent in earnings per share over the past decade. The average operating margin is 28.11 percent and the return on investment 18.52 percent (5-year average).

Source: Promising Mid- and Large-Cap Dividend Stocks