For a look at what the "smart money" thinks about a stock, one good source is sell side analyst ratings. Positive ratings from prominent analysts can have a big effect on a stock's price.
We ran a screen on stocks paying dividend yields above 2% and sustainable payout ratios below 50%. We screened these stocks for those with current "Buy" ratings from Deutsche Bank, indicating that their analysts believe these stocks will soon outperform.
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 also believe these stocks will outperform? Use this list as a starting point for your own analysis.
List sorted by ratings date.
1. Steel Dynamics Inc. (STLD): Engages in the manufacture and sale of steel products in the United States. Market cap of $3.31B. Dividend yield at 2.64%, payout ratio at 32.02%. On 01/17/2012, Deutsche Bank had a Buy rating on the stock. The stock has had a good month, gaining 26.78%.
2. Accenture plc (ACN): Operates as a management consulting, technology services, and outsourcing company. Market cap of $39.44B. Dividend yield at 2.42%, payout ratio at 33.45%. On 10/07/2011, Deutsche Bank had a Buy rating on the stock. The stock has gained 11.33% over the last year.
3. CenterPoint Energy, Inc. (CNP): Operates as a public utility holding company in the United States. Market cap of $8.01B. Dividend yield at 4.31%, payout ratio at 43.12%. On 08/05/2011, Deutsche Bank had a Buy rating on the stock. The stock has gained 23.18% over the last year.
4. Procter & Gamble Co. (PG): Provides consumer packaged goods in the United States and internationally. Market cap of $182.22B. Dividend yield at 3.17%, payout ratio at 48.59%. On 04/29/2011, Deutsche Bank had a Buy rating on the stock. The stock has gained 3.97% over the last year.
5. Colgate-Palmolive Co. (CL): Manufactures and markets consumer products worldwide. Market cap of $43.08B. Dividend yield at 2.61%, payout ratio at 44.15%. On 04/29/2011, Deutsche Bank had a Buy rating on the stock. The stock has gained 16.48% over the last year.
6. Alterra Capital Holdings Limited (ALTE): Provides specialty insurance and reinsurance products to corporations, public entities, and property and casualty insurers principally in Bermuda, Ireland, the United States, and the United Kingdom. Market cap of $2.55B. Dividend yield at 2.29%, payout ratio at 47.39%. On 04/04/2011, Deutsche Bank had a Buy rating on the stock. The stock has gained 14.31% over the last year.
7. Emerson Electric Co. (EMR): Operates as a diversified manufacturing and technology company. Market cap of $36.27B. Dividend yield at 3.24%, payout ratio at 42.34%. On 03/31/2011, Deutsche Bank had a Buy rating on the stock. The stock has lost 11.78% over the last year.
8. BB&T Corporation (BBT): Operates as the financial holding company for Branch Banking and Trust Company that provides banking and trust services to small and mid-size businesses, public agencies, local governments, and individuals in the United States. Market cap of $19.16B. Dividend yield at 2.33%, payout ratio at 34.60%. On 03/16/2011, Deutsche Bank had a Buy rating on the stock. The stock has had a good month, gaining 17.43%.
9. Molex Inc. (MOLX): Manufactures and sells electronic components worldwide. Market cap of $4.75B. Dividend yield at 2.96%, payout ratio at 43.24%. On 02/18/2011, Deutsche Bank had a Buy rating on the stock. Exhibiting strong upside momentum--currently trading 8.73% above its SMA20, 12.34% above its SMA50, and 15.33% above its SMA200. The stock has had a good month, gaining 22.12%.
10. Air Products & Chemicals Inc. (APD): Provides atmospheric gases, process and specialty gases, performance materials, equipment, and services worldwide. Market cap of $19.08B. Dividend yield at 2.56%, payout ratio at 38.99%. On 02/18/2011, Deutsche Bank had a Buy rating on the stock. The stock has had a good month, gaining 12.14%.
11. The Interpublic Group of Companies, Inc. (IPG): Provides advertising and marketing services worldwide. Market cap of $4.85B. Dividend yield at 2.28%, payout ratio at 25.19%. On 02/11/2011, Deutsche Bank had a Buy rating on the stock. The stock has had a good month, gaining 16.5%.
12. Ternium S.A. (TX): Engages in manufacturing and processing a range of flat and long steel products for construction, home appliances, capital goods, container, food, energy, and automotive industries. Market cap of $4.58B. Dividend yield at 3.29%, payout ratio at 10.31%. On 01/28/2011, Deutsche Bank had a Buy rating on the stock. This is a risky stock that is significantly more volatile than the overall market (beta = 2.27). The stock has had a couple of great days, gaining 8.05% over the last week.
*Ratings 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.
