5 Highly Liquid Dividend Stocks With Positive Sales Trends

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 |  Includes: FL, LANC, STJ, SUP, TFX
by: Kapitall

Do you prefer stocks that pay dividends you can rely on? For a closer look at stocks that appear to pay sustainable dividends, we ran a screen you may be interested in.

We began by screening for stocks paying dividend yields above 2% and sustainable payout ratios below 50%. We then screened for those with strong liquidity, indicated by current ratios above 3. Since the current ratio equals current assets/current liabilities, companies with current ratios above 3 have at least 3 times liquid assets to cover their short-term liabilities. This bodes well for a company's ability to continue paying a dividend.

We then screened these names for those with strong sales trends, comparing growth in revenue to growth in inventory over the last year. We screened for stocks with positive sales trends, with faster growth in revenue than inventory over the last year. Since inventory represents the portion of goods not yet sold, faster growth in revenue than inventory is considered a good sign.

To screen for healthy liquidity. We also only focused on those companies with inventory declining as a percent of current assets.

Interactive Chart: Press Play to compare changes in market cap 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 pay reliable dividends? Use this list as a starting point for your own analysis.

List sorted by growth in revenue over the last year.

1. Foot Locker, Inc. (NYSE:FL): Operates as a retailer of athletic footwear and apparel. Market cap at $4.83B, most recent closing price at $31.76. Dividend yield at 2.26%, payout ratio at 36.17%. Current ratio at 3.79. Revenue grew by 7.9% during the most recent quarter ($1,502M vs. $1,392M y/y). Inventory grew by 0.94% during the same time period ($1,069M vs. $1,059M y/y). Inventory, as a percentage of current assets, decreased from 54.76% to 51.42% during the most recent quarter (comparing 13 weeks ending 2012-01-28 to 13 weeks ending 2011-01-29).

2. Lancaster Colony Corporation (NASDAQ:LANC): Engages in the manufacture and marketing of consumer products focusing primarily on specialty foods for the retail and food service markets in the United States. Market cap at $1.78B, most recent closing price at $65.11. Dividend yield at 2.20%, payout ratio at 38.02%. Current ratio at 4.68. Revenue grew by 7.32% during the most recent quarter ($271.1M vs. $252.62M y/y). Inventory grew by -3.69% during the same time period ($100.28M vs. $104.12M y/y). Inventory, as a percentage of current assets, decreased from 32.82% to 26.48% during the most recent quarter (comparing 3 months ending 2012-03-31 to 3 months ending 2011-03-31).

3. Superior Industries International, Inc. (NYSE:SUP): Designs, develops, manufactures, sells and supplies cast aluminum road wheels to automobile and light truck manufacturers primarily in North America. Market cap at $465.49M, most recent closing price at $16.96. Dividend yield at 3.74%, payout ratio at 26.41%. Current ratio at 5.71. Revenue grew by 6.82% during the most recent quarter ($202.46M vs. $189.53M y/y). Inventory grew by -14.37% during the same time period ($69.13M vs. $80.73M y/y). Inventory, as a percentage of current assets, decreased from 20.23% to 16.66% during the most recent quarter (comparing 3 months ending 2012-03-25 to 3 months ending 2011-03-27).

4. Teleflex Incorporated (NYSE:TFX): Develops, manufactures and supplies single-use medical devices used by hospitals and healthcare providers worldwide. Market cap at $2.58B, most recent closing price at $62.51. Dividend yield at 2.15%, payout ratio at 45.69%. Current ratio at 4.72. Revenue grew by 6.59% during the most recent quarter ($411.73M vs. $386.28M y/y). Inventory grew by -11.76% during the same time period ($298.77M vs. $338.6M y/y). Inventory, as a percentage of current assets, decreased from 36.76% to 23.34% during the most recent quarter (comparing three months ending 2011-12-31 to 3 months ending 2010-12-31).

5. St. Jude Medical Inc. (NYSE:STJ): Develops, manufactures and distributes cardiovascular and implantable neurostimulation medical devices worldwide. Market cap at $12.18B, most recent closing price at $38.84. Dividend yield at 2.37%, payout ratio at 34.23%. Current ratio at 3.31. Revenue grew by 1.42% during the most recent quarter ($1,395M vs. $1,375.51M y/y). Inventory grew by -10.17% during the same time period ($626M vs. $696.86M y/y). Inventory, as a percentage of current assets, decreased from 22.24% to 17.79% during the most recent quarter (comparing 13 weeks ending 2012-03-31 to 13 weeks ending 2011-04-02).

*Accounting data sourced from Google 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.