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Dividend Challengers are stocks which have raised dividends for a period of 5-9 consecutive years. They are the third party of the most trustful stocks behind Dividend Champions (>25 years) and Dividend Contenders (10-24 years). A perfect investment is a high yielding Challenger with ongoing dividend growth. One day, the stock will become a Dividend Contender or even a Champion. But the reason of further dividend growth is the ability to generate long-term growth. We all agree that nothing else implies future growth better as the current stock price. A strong stock price indicates that the company has a rosy future.

However, I screened the investment category Dividend Contenders, which contains roughly 200 stocks, by high yielding stocks with good future conditions. Exactly 31 have a dividend yield of more than 5 percent. I decided to look only at stocks that are near to their 52-Week Highs in order to make sure that the company is well on track. 6 stocks remained. These are the results:

1. Targa Resources Partners (NGLS) has a market capitalization of $3.09 billion. The company employs 1,020 people, generates revenues of $5,460.20 million and has a net income of $134.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $393.60 million. Because of these figures, the EBITDA margin is 7.21 percent (operating margin 3.98 percent and the net profit margin finally 2.45 percent).

The total debt representing 45.36 percent of the company’s assets and the total debt in relation to the equity amounts to 157.14 percent. Due to the financial situation, the return on equity amounts to 8.70 percent. Finally, earnings per share amounts to $1.63 of which $2.10 were paid in form of dividends to shareholders last fiscal. The company raised dividends for 5 consecutive years.

Here are the price ratios of the company: The P/E ratio is 21.93, Price/Sales 0.56 and Price/Book ratio 3.00. Dividend Yield: 6.61 percent. The beta ratio is 1.23.

2. Holly Energy Partners (HEP) has a market capitalization of $1.25 billion. The company employs 148 people, generates revenues of $182.10 million and has a net income of $58.87 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $121.35 million. Because of these figures, the EBITDA margin is 66.64 percent (operating margin 49.84 percent and the net profit margin finally 32.33 percent).

The total debt representing 76.43 percent of the company’s assets and the total debt in relation to the equity amounts to 449.52 percent. Due to the financial situation, the return on equity amounts to 17.33 percent. Finally, earnings per share amounts to $2.47 of which $3.32 were paid in form of dividends to shareholders last fiscal. The company raised dividends for 7 consecutive years.

Here are the price ratios of the company: The P/E ratio is 22.82, Price/Sales 6.77 and Price/Book ratio 4.91. Dividend Yield: 6.27 percent. The beta ratio is 0.65.

3. Reynolds American (RAI) has a market capitalization of $22.57 billion. The company employs 5,700 people, generates revenues of $8,551.00 million and has a net income of $1,329.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $2,570.00 million. Because of these figures, the EBITDA margin is 30.05 percent (operating margin 28.29 percent and the net profit margin finally 15.54 percent).

The total debt representing 24.01 percent of the company’s assets and the total debt in relation to the equity amounts to 63.00 percent. Due to the financial situation, the return on equity amounts to 20.43 percent. Finally, earnings per share amounts to $2.28 of which $1.84 were paid in form of dividends to shareholders last fiscal. The company raised dividends for 8 consecutive years.

Here are the price ratios of the company: The P/E ratio is 17.02, Price/Sales 2.65 and Price/Book ratio 3.48. Dividend Yield: 5.76 percent. The beta ratio is 0.59.

4. Verizon Communications (VZ) has a market capitalization of $104.75 billion. The company employs 195,400 people, generates revenues of $106,565.00 million and has a net income of $10,217.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $32,862.00 million. Because of these figures, the EBITDA margin is 30.84 percent (operating margin 13.74 percent and the net profit margin finally 9.59 percent).

The total debt representing 24.00 percent of the company’s assets and the total debt in relation to the equity amounts to 136.88 percent. Due to the financial situation, the return on equity amounts to 6.38 percent. Finally, earnings per share amounts to $2.49 of which $1.92 were paid in form of dividends to shareholders last fiscal. The company raised dividends for 7 consecutive years.

Here are the price ratios of the company: The P/E ratio is 14.84, Price/Sales 1.00 and Price/Book ratio 2.75. Dividend Yield: 5.33 percent. The beta ratio is 0.58.

5. Williams Partners (WPZ) has a market capitalization of $16.60 billion. The company employs 3,176 people, generates revenues of $5,715.00 million and has a net income of $1,101.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1,907.00 million. Because of these figures, the EBITDA margin is 33.37 percent (operating margin 23.45 percent and the net profit margin finally 19.27 percent).

The total debt representing 50.93 percent of the company’s assets and the total debt in relation to the equity amounts to 134.42 percent. Due to the financial situation, the return on equity amounts to 8.85 percent. Finally, earnings per share amounts to $3.38 of which $2.72 were paid in form of dividends to shareholders last fiscal. The company raised dividends for 7 consecutive years.

Here are the price ratios of the company: The P/E ratio is 16.89, Price/Sales 2.90 and Price/Book ratio 3.26. Dividend Yield: 5.23 percent. The beta ratio is 1.14.

6. Lockheed Martin (LMT) has a market capitalization of $25.03 billion. The company employs 126,000 people, generates revenues of $45,803.00 million and has a net income of $2,645.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $5,087.00 million. Because of these figures, the EBITDA margin is 11.11 percent (operating margin 8.94 percent and the net profit margin finally 5.77 percent).

The total debt representing 14.31 percent of the company’s assets and the total debt in relation to the equity amounts to 135.36 percent. Due to the financial situation, the return on equity amounts to 67.50 percent. Finally, earnings per share amounts to $7.97 of which $2.64 were paid in form of dividends to shareholders last fiscal. The company raised dividends for 9 consecutive years.

Here are the price ratios of the company: The P/E ratio is 9.70, Price/Sales 0.55 and Price/Book ratio 7.22. Dividend Yield: 5.17 percent. The beta ratio is 0.90.

Source: 6 Dividend Challengers With High Yields On The Way To Cross One-Year Highs