Do you prefer stocks that have paid consistent dividends for a long period of time? For ideas, we ran a screen.
We screened dividend champions stocks, those that have consistently increased their dividend over the past 25 years, for those that appear undervalued relative to EPS trends.
Based on the assumption that P/E is equal to a constant k, increases in EPS should be matched by proportionate increases in price. When they don't match up, a mispricing may have occurred.
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the 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 are attractively priced? Use this list as a starting point for your own analysis.
1. Commerce Bancshares Inc. (CBSH): Operates as the bank holding company for Commerce Bank, N. Dividend yield at 2.36%, payout ratio at 31.10%. The EPS estimate for the company's current year increased from 2.83 to 2.85 over the last 30 days, an increase of 0.71%. This increase came during a time when the stock price changed by 0.33% (from 38.96 to 39.09 over the last 30 days).
2. Genuine Parts Company (GPC): Distributes automotive replacement parts, industrial replacement parts, office products, and electrical/electronic materials in the United States, Puerto Rico, Canada, and Mexico. Dividend yield at 3.16%, payout ratio at 49.82%. The EPS estimate for the company's current year increased from 3.97 to 4.02 over the last 30 days, an increase of 1.26%. This increase came during a time when the stock price changed by -3.16% (from 64.26 to 62.23 over the last 30 days).
3. The McGraw-Hill Companies, Inc. (MHP): Provides various information services for financial, educational, and business information markets worldwide. Dividend yield at 2.18%, payout ratio at 35.19%. The EPS estimate for the company's current year increased from 3.2 to 3.3 over the last 30 days, an increase of 3.12%. This increase came during a time when the stock price changed by -0.6% (from 46.31 to 46.03 over the last 30 days).
4. Stepan Company (SCL): Engages in the production and sale of specialty and intermediate chemicals to manufacturers in various industries worldwide. Dividend yield at 1.24%, payout ratio at 15.13%. The EPS estimate for the company's current year increased from 7.39 to 7.46 over the last 30 days, an increase of 0.95%. This increase came during a time when the stock price changed by 0.67% (from 85.41 to 85.98 over the last 30 days).
*EPS 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.