14 Highly Liquid Dividend Stocks Undervalued By Cash Flows

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 |  Includes: AMAT, ATVI, BEN, BRKS, CSCO, FCX, FINL, FLXS, GROW, JCS, KLAC, MKSI, SNI, XLNX
by: Kapitall

For a look at stocks that offer both income and the possibility for growth, here are some ideas you may find interesting.

We ran a screen on dividend stocks with high liquidity, with current ratios over 3. We screened these stocks for those that appear undervalued to levered free cash flows, with high ratios of levered free cash flow/enterprise value. Levered free cash flow is the cash flow available after paying interest on outstanding debt. Enterprise value is the value of a company from all sources of ownership.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬


We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

Do you think these stocks should be trading higher? Use this list as a starting point for your own analysis.

List sorted by levered free cash flow/enterprise value.

1. MKS Instruments Inc. (NASDAQ:MKSI): Provides instruments, subsystems, and process control solutions that measure, control, power, monitor, and analyze parameters of manufacturing processes worldwide. Market cap of $1.28B. Dividend yield at 2.47%, payout ratio at 16.69%. Current ratio at 10.25. Levered free cash flow/enterprise value at 21.1% (levered free cash flow at $158.68M and enterprise value at $751.93M). The stock has performed poorly over the last month, losing 11.17%.

2. Brooks Automation Inc. (NASDAQ:BRKS): Provides automation, vacuum, and instrumentation solutions primarily to the semiconductor manufacturing industry worldwide. Market cap of $593.87M. Dividend yield at 3.57%, payout ratio at 4.13%. Current ratio at 3.35. Levered free cash flow/enterprise value at 18.29% (levered free cash flow at $77.99M and enterprise value at $426.49M). It's been a rough couple of days for the stock, losing 10.49% over the last week.

3. Applied Materials Inc. (NASDAQ:AMAT): Provides manufacturing equipment, services, and software to the semiconductor, flat panel display, solar photovoltaic (PV), and related industries worldwide. Market cap of $13.70B. Dividend yield at 3.08%, payout ratio at 21.21%. Current ratio at 3.71. Levered free cash flow/enterprise value at 17.61% (levered free cash flow at $1.59B and enterprise value at $9.03B). The stock is currently stuck in a downtrend, trading 12.12% below its SMA20, 8.3% below its SMA50, and 19.51% below its SMA200. It's been a rough couple of days for the stock, losing 6.73% over the last week.

4. Communications Systems Inc. (NASDAQ:JCS): Manufactures and sells modular connecting and wiring devices, and media and rate conversion products. Market cap of $109.26M. Dividend yield at 4.72%, payout ratio at 40.17%. Current ratio at 5.73. Levered free cash flow/enterprise value at 17.42% (levered free cash flow at $12.40M and enterprise value at $71.18M). The stock is currently stuck in a downtrend, trading 10.91% below its SMA20, 10.14% below its SMA50, and 17.6% below its SMA200. The stock has performed poorly over the last month, losing 22.57%.

5. Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX): Engages in the exploration, mining, and production of mineral resources. Market cap of $34.07B. Dividend yield at 2.78%, payout ratio at 34.67%. Current ratio at 3.37. Levered free cash flow/enterprise value at 15.94% (levered free cash flow at $5.49B and enterprise value at $34.44B). The stock has performed poorly over the last month, losing 15.93%.

6. Flexsteel Industries Inc. (NASDAQ:FLXS): Manufactures, imports, and markets residential and commercial upholstered and wooden furniture products in the United States. Market cap of $94.17M. Dividend yield at 2.87%, payout ratio at 20.90%. Current ratio at 4.75. Levered free cash flow/enterprise value at 15.38% (levered free cash flow at $12.09M and enterprise value at $78.62M). The stock has lost 17.77% over the last year.

7. Scripps Networks Interactive, Inc. (NASDAQ:SNI): Operates as a lifestyle content and Internet search company in the United States and internationally. Market cap of $6.20B. Dividend yield at 1.03%, payout ratio at 12.46%. Current ratio at 5.84. Levered free cash flow/enterprise value at 14.32% (levered free cash flow at $961.09M and enterprise value at $6.71B). The stock has performed poorly over the last month, losing 11.87%.

8. Finish Line Inc. (NASDAQ:FINL): Operates as a mall-based specialty retailer in the United States. Market cap of $1.04B. Dividend yield at 1.0%, payout ratio at 13.53%. Current ratio at 3.42. Levered free cash flow/enterprise value at 13.99% (levered free cash flow at $96.10M and enterprise value at $686.88M). The stock is a short squeeze candidate, with a short float at 12.43% (equivalent to 6.55 days of average volume). The stock has gained 14.84% over the last year.

9. Cisco Systems, Inc. (NASDAQ:CSCO): Designs, manufactures, and sells Internet protocol (IP)-based networking and other products related to the communications and information technology industry worldwide. Market cap of $96.82B. Dividend yield at 1.33%, payout ratio at 15.46%. Current ratio at 3.28. Levered free cash flow/enterprise value at 12.59% (levered free cash flow at $8.38B and enterprise value at $66.54B). The stock has lost 6.3% over the last year.

10. KLA-Tencor Corporation (NASDAQ:KLAC): Engages in the design, manufacture, and marketing of process control and yield management solutions for the semiconductor and related nanoelectronics industries. Market cap of $7.25B. Dividend yield at 3.22%, payout ratio at 22.12%. Current ratio at 4.90. Levered free cash flow/enterprise value at 12.48% (levered free cash flow at $706.63M and enterprise value at $5.66B). The stock has gained 20.09% over the last year.

11. Franklin Resources Inc. (NYSE:BEN): Provides its services to individuals, institutions, pension plans, trusts, and partnerships. Market cap of $20.48B. Dividend yield at 1.06%, payout ratio at 11.53%. Current ratio at 5.81. Levered free cash flow/enterprise value at 12.42% (levered free cash flow at $1.86B and enterprise value at $14.98B). It's been a rough couple of days for the stock, losing 5.19% over the last week.

12. U.S. Global Investors, Inc. (NASDAQ:GROW): A publicly owned investment manager. Market cap of $97.05M. Dividend yield at 3.74%, payout ratio at 43.74%. Current ratio at 8.26. Levered free cash flow/enterprise value at 11.82% (levered free cash flow at $7.53M and enterprise value at $63.69M). The stock is currently stuck in a downtrend, trading 11.09% below its SMA20, 8.99% below its SMA50, and 17.24% below its SMA200. It's been a rough couple of days for the stock, losing 11.41% over the last week.

13. Activision Blizzard, Inc. (NASDAQ:ATVI): Publishes online, personal computer (PC), console, handheld, and mobile games of interactive entertainment worldwide. Market cap of $13.91B. Dividend yield at 1.36%, payout ratio at 28.12%. Current ratio at 3.19. Levered free cash flow/enterprise value at 11.76% (levered free cash flow at $1.24B and enterprise value at $10.54B). The stock has gained 5.19% over the last year.

14. Xilinx Inc. (NASDAQ:XLNX): Designs, develops, and markets programmable platforms in North America, the Asia Pacific, Europe, and Japan. Market cap of $8.07B. Dividend yield at 2.47%, payout ratio at 31.03%. Current ratio at 6.57. Levered free cash flow/enterprise value at 11.06% (levered free cash flow at $771.69M and enterprise value at $6.98B). The stock has gained 14.57% over the last year.

*Data from 11/25. Levered free cash flow and enterprise value data sourced from Yahoo! Finance, all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.